High-profile investors warned of an impending AI bubble after tech stocks drove the S&P 500 and Nasdaq to all-time highs.
Gains for AI firms have overcome declines for financial, healthcare, and consumer-focused companies: “Increasingly, the market is running on one engine,” The Wall Street Journal reported, while “just about everything else is going down.” That has driven fears that any fall in tech stocks, which now represent a huge portion of many investors’ portfolios, could have dire consequences.
Bridgewater founder Ray Dalio told a conference in Singapore that he saw a “classic bubble” market that was close to bursting, while Temasek’s chief investment officer argued that an unwinding of the AI trade was the biggest risk to markets in 2027.
