AI stocks stumble as investors weigh profits against bubble risk
AI-related stocks pulled back after a sharp rally as investors debated whether the pullback is simply profit-taking or a sign of nerves about an AI-driven bubble and potential oversupply. Major AI spenders—Alphabet, Amazon, Meta, and Microsoft—are pouring hundreds of billions into data centers, while chipmakers and AI hardware names led declines, raising questions about whether lofty valuations and financing needs can be justified by future profits. Analysts warn rapid capital expenditure could weigh on pricing and returns, even as demand for AI infrastructure remains a longer-term driver in tech, with mixed signals from Asia.
