AI boom may already have peaked
QQQ•BCA Research’s Arthur Budaghyan says risks to the AI spending boom are skewed to the downside and sees a one-in-three chance of a “Goldilocks” outcome. He recommends investors avoid or underweight equities, citing risks of excess computing capacity or persistently high compute costs that could curb demand.
1. AI demand remains uncertain
Budaghyan said companies are spending heavily on data centres and computing infrastructure, but future demand for AI services and what customers will pay remain unclear. He sees a one-in-three chance of a favorable “Goldilocks” outcome; the alternatives are a glut of computing capacity that crushes returns or “AI stagflation” that keeps compute expensive and chokes off demand.
2. European shares gain
The STOXX rose 0.4% to a record, with healthcare leading gainers and technology shares lower. Nasdaq futures were also lower.
