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3h ago

AI Boom Powers Records Despite Bubble Warnings

Fresh warnings highlight stretched valuations alongside circular financing as potential triggers for a sharp correction.

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The New York Stock Exchange in New York, on Wednesday, July 2, 2025.
An Amazon Web Services data center in Manassas, Virginia, on Wednesday, July 9, 2025.

Overview

  • Global equities hovered near records led by AI-linked mega-caps, with the S&P 500 and Nasdaq at all-time highs and Asian markets advancing.
  • The IMF and the Bank of England cautioned that valuations for AI-focused tech look stretched, with heightened index concentration increasing systemic risk.
  • JPMorgan’s Jamie Dimon warned of a serious market correction within six to twenty-four months even as he said AI will ultimately deliver.
  • Deal scrutiny intensified after Nvidia’s $100 billion pledge to OpenAI, including at least 10 gigawatts of Vera Rubin systems from late 2026, and AMD’s agreement to supply up to 6 gigawatts from 2026 that CEO Lisa Su said could generate tens of billions in revenue.
  • Analysts remain divided, with Goldman Sachs and Bank of America arguing the rally is grounded in profits and strong balance sheets, while seven mega-caps have produced 55% of S&P 500 gains since 2022.