Overview
- The Bank of England cautioned that stretched valuations tied to heavy AI investment could trigger a sharp correction in major tech stocks.
- Market leadership is highly concentrated, with the top 10 companies making up about 42% of the S&P 500, heightening index-level risk.
- Strategists foresee a 2026 split between heavy AI spenders and firms that clearly monetize AI, with Oracle’s revenue miss and rising capex intensifying ROI scrutiny.
- Goldman Sachs projects hyperscalers will boost 2026 data‑center investment to roughly $527 billion, an increase of about 34% from 2025.
- Investor sentiment remains mixed, with retail surveys showing optimism even as analysts outline outcomes ranging from a results-led rebound to a 10%–20% pullback if AI revenue expectations falter.