The high investment-grade credit spreads for AI hyperscalers and the persistently high levels of Oracle's five-year CDS indicate that bond investors remain concerned about the marginal changes in free cash flow, buyback capacity, and balance sheets following large tech companies' continued expansion of AI capital expenditures.
This creates a clear cross-asset divergence: equity funds are still chasing AI profit stories, while the credit market has already begun to repric AI capital expenditures.
Bank of America investment strategist Hartnett even believes that only a strong recovery in large tech stocks can suppress concerns that "domestic computing power may prematurely weaken the AI capital expenditure cycle." Therefore, going forward, observing AI should not only focus on the Nasdaq or chip stocks, but also on whether credit spreads for tech companies continue to widen. If stocks rise while credit continues to deteriorate, it indicates that there is still no consensus between equities and bonds regarding the returns on AI.
