{"id":38242,"date":"2025-11-18T11:21:05","date_gmt":"2025-11-18T11:21:05","guid":{"rendered":"https:\/\/financialrush.com\/?p=38242"},"modified":"2025-11-18T11:21:05","modified_gmt":"2025-11-18T11:21:05","slug":"fund-managers-alarmed-by-corporate-investment-boom-as-ai-bubble-fears-grow","status":"publish","type":"post","link":"https:\/\/financialrush.com\/?p=38242","title":{"rendered":"Fund managers alarmed by corporate investment boom as AI bubble fears grow"},"content":{"rendered":"<p> \n<\/p>\n<div>\n<p>Stay informed with free updates<\/p>\n<p class=\"article__content-sign-up-topic-description o3-type-body-base\"><span>Simply sign up to the <!-- -->Fund management<!-- --> myFT Digest &#8212; delivered directly to your inbox.<\/span><\/p>\n<p><iframe class=\"article__content-sign-up-iframe close\" scrolling=\"no\" id=\"signUpIframe\" data-prev-url=\"\/register\/in-article-sign-up?ft-content-uuid=e2d93034-ef3b-4259-9ab1-c45396ca59b3&amp;concept-id=67fdde56-9e5e-405c-b26f-e58a6ad11c33\"><\/iframe><\/div>\n<div id=\"article-body\">\n<p>A majority of global fund managers think companies are overinvesting, as market anxiety grows about the sustainability of the artificial intelligence spending boom.<\/p>\n<p>A net 20 per cent of fund managers surveyed this month by <a href=\"https:\/\/www.ft.com\/stream\/74bb961d-a454-4214-bff7-390d68752fb0\" title=\"\" data-trackable=\"link\">Bank of America<\/a> said companies were spending too much on their investments \u2014 the first time this has been a majority view in data running back to 2005.<\/p>\n<p>\u201cThis jump is driven by concerns over the magnitude and financing of the AI capex boom,\u201d said BofA analysts.<\/p>\n<p>The surge in investment to develop AI infrastructure has been a dominant theme in the record rally in US tech stocks this year \u2014 with chipmaker <a href=\"https:\/\/www.ft.com\/content\/62933c70-261c-4b7a-a045-3f9f9cceccd7\" title=\"\" data-trackable=\"link\">Nvidia becoming<\/a> the world\u2019s first $5tn company last month \u2014 but growing concerns about the sustainability of this spending has caused a pullback on Wall Street in recent weeks.<\/p>\n<figure id=\"omtrphrw\" class=\"n-content-image n-content-image--full\" data-component=\"image-set\"><picture><source media=\"(min-width: 700px)\" srcset=\"https:\/\/images.ft.com\/v3\/image\/raw\/ftcms%3A992dd249-d7f5-4a3f-86e5-c83e96b3d6df?source=next-article&amp;fit=scale-down&amp;quality=highest&amp;width=700&amp;dpr=1 1x,https:\/\/images.ft.com\/v3\/image\/raw\/ftcms%3A992dd249-d7f5-4a3f-86e5-c83e96b3d6df?source=next-article&amp;fit=scale-down&amp;quality=highest&amp;width=700&amp;dpr=2 2x,https:\/\/images.ft.com\/v3\/image\/raw\/ftcms%3A992dd249-d7f5-4a3f-86e5-c83e96b3d6df?source=next-article&amp;fit=scale-down&amp;quality=highest&amp;width=700&amp;dpr=3 3x,https:\/\/images.ft.com\/v3\/image\/raw\/ftcms%3A992dd249-d7f5-4a3f-86e5-c83e96b3d6df?source=next-article&amp;fit=scale-down&amp;quality=highest&amp;width=700&amp;dpr=4 4x,https:\/\/images.ft.com\/v3\/image\/raw\/ftcms%3A992dd249-d7f5-4a3f-86e5-c83e96b3d6df?source=next-article&amp;fit=scale-down&amp;quality=highest&amp;width=700&amp;dpr=5 5x\" width=\"3500\" height=\"2500\"\/><source media=\"(max-width: 490px)\" srcset=\"https:\/\/images.ft.com\/v3\/image\/raw\/ftcms%3Aa718ef22-cdd2-475f-abb3-42db3ad81328?source=next-article&amp;fit=scale-down&amp;quality=highest&amp;width=490&amp;dpr=1 1x,https:\/\/images.ft.com\/v3\/image\/raw\/ftcms%3Aa718ef22-cdd2-475f-abb3-42db3ad81328?source=next-article&amp;fit=scale-down&amp;quality=highest&amp;width=490&amp;dpr=2 2x,https:\/\/images.ft.com\/v3\/image\/raw\/ftcms%3Aa718ef22-cdd2-475f-abb3-42db3ad81328?source=next-article&amp;fit=scale-down&amp;quality=highest&amp;width=490&amp;dpr=3 3x\" width=\"1500\" height=\"2000\"\/><\/picture><\/figure>\n<p>The tech-heavy Nasdaq Composite has fallen 4 per cent this month, and US futures suggested it was poised to open 0.3 per cent lower on Tuesday. Investors are bracing for third-quarter earnings from Nvidia on Wednesday. The chipmaker\u2019s share price fell on Monday after filings revealed that Peter Thiel\u2019s hedge fund dumped its entire holding in the stock.<\/p>\n<p>The tech spending boom is also reshaping credit markets: US companies <a href=\"https:\/\/www.ft.com\/content\/82f63f23-db20-4f6c-84f1-e7b45ca09f46\" title=\"\" data-trackable=\"link\">have issued<\/a> more than $200bn worth of bonds this year to finance their AI-related projects amid warnings over a \u201cflood\u201d of further issuance.\u00a0<\/p>\n<p>Anton Dombrovskiy, fixed income portfolio specialist at T Rowe Price, said \u201cpublic and private credit seems to have become a major source of funding for AI investments, and its rapid growth raised some concerns\u201d.\u00a0<\/p>\n<p>More than 50 per cent of the fund managers surveyed by BofA, who between them manage about $500bn in investor assets, said that <a href=\"https:\/\/www.ft.com\/artificial-intelligence\" title=\"\" data-trackable=\"link\">AI<\/a> stocks were already in a bubble. <\/p>\n<p>Some 45 per cent saw that as the biggest \u201ctail risk\u201d to markets and the global economy, up from 33 per cent last month, and overshadowing other threats such as inflation or a US consumer crunch.<\/p>\n<p>Despite investors\u2019 concern about the level of spending, the survey\u2019s broad measure of investor sentiment \u2014 derived from cash levels, equity allocation and economic growth expectations \u2014 rose to its highest level since February this year, shortly before Donald Trump shocked markets with his global tariffs.<\/p>\n<p>Investors\u2019 average allocations to cash dropped to just 3.7 per cent of portfolios, which BofA pointed out is a level that has historically been followed by a drop in stock markets and a rally in government bonds in the following one to three months.\u00a0<\/p>\n<\/div>\n\n<br \/><a href=\"https:\/\/www.ft.com\/content\/e2d93034-ef3b-4259-9ab1-c45396ca59b3\">Source link <\/a><\/p>\n","protected":false},"excerpt":{"rendered":"Stay informed with free updates Simply sign up to the Fund management myFT Digest &#8212; delivered directly to&hellip;\n","protected":false},"author":7,"featured_media":38243,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[12],"tags":[],"class_list":["post-38242","post","type-post","status-publish","format-standard","has-post-thumbnail","category-tech","cs-entry","cs-video-wrap"],"_links":{"self":[{"href":"https:\/\/financialrush.com\/index.php?rest_route=\/wp\/v2\/posts\/38242","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/financialrush.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/financialrush.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/financialrush.com\/index.php?rest_route=\/wp\/v2\/users\/7"}],"replies":[{"embeddable":true,"href":"https:\/\/financialrush.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=38242"}],"version-history":[{"count":0,"href":"https:\/\/financialrush.com\/index.php?rest_route=\/wp\/v2\/posts\/38242\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/financialrush.com\/index.php?rest_route=\/wp\/v2\/media\/38243"}],"wp:attachment":[{"href":"https:\/\/financialrush.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=38242"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/financialrush.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=38242"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/financialrush.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=38242"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}