Despite the Iran war, rising inflation and growing worries about government debt, US stock markets have continued to hit all-time highs this year. The relentless rally is being fuelled by a huge boom in investment in Artificial Intelligence.
But the apparent mismatch between sky-high stock market valuations and the real economy is beginning to set off alarm bells among investors. The question on Wall Street is whether the AI-driven surge is a sustainable revolution or a bubble waiting to burst.
“US markets hit record highs driven by AI investment, despite war, inflation and debt fears, raising bubble concerns.”
BBC’s Samira Hussain reports from Wall Street that the optimism around AI has propelled markets to record after record, even as geopolitical tensions and economic headwinds mount. For now, the momentum shows no signs of slowing, but the unease is growing. The stakes could not be higher: if the bubble bursts, the fallout would ripple far beyond the trading floors of New York.