Morgan Stanley says stock market rally faces $1.2 trillion question

MacroIndustry Impact 4
โดย TheStreet·Read original
Summary · why it matters

Morgan Stanley warns that the stock market rally faces a $1.2 trillion question over Big Tech's AI spending, with a much narrower margin for error. The bank's base case expects AI investment to jump from nearly $800 billion in 2026 to roughly $1.2 trillion in 2027, but the risk is that second-quarter earnings could show hesitation from major spenders. S&P 500 second-quarter 2026 profits are now expected to rise 23.3%, led by a 63.3% earnings surge in the Information Technology sector. Additional headwinds include potential oil price spikes from Iran escalation and the possibility that the Federal Reserve may need to hike rates if inflation pressure builds, with markets pricing an 82% chance of at least one hike by year-end.

Impact on stocks 3

Artificial Intelligence▼ · 2 stocks
NVIDIA Corporation
NVDA
▼ NegativeCapitalrelevance

Article highlights risk of AI investment hesitation and potential earnings disappointment for tech sector, affecting NVIDIA.

Apple Inc.
AAPL
▼ NegativeCapitalrelevance

Article warns Big Tech AI spending faces risk of hesitation, which could impact Apple's earnings growth.

Financials▲ · 1 stocks

Theme Impact 9

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