AI capex is now the market's biggest question mark, and the energy shock is piling on.
Published research this week flags a record Alphabet drop, Amazon running roughly $220bn in capex with negative free cash flow, and a soft Intel outlook. Analysts argue the debate has shifted from how fast AI grows to how profitably it grows. A parallel thread of credit research points to AI-linked debt issuance running far above last year, rising CDS costs on Oracle and neocloud names, and widening spreads. The consensus framing is that funding and monetisation — not demand — are the pressure points. Some recently published views also warn that state-level resistance to data-center permits after the US midterms could slow the build-out.
On energy, researchers cite Brent near $116–118 on fears the US resumes strikes on Iran after November 3, with one published forecast putting Brent at $120 in H1 2027. European gas above 100 EUR/MWh is feeding inflation, and a growing camp expects a Fed hike in December, with the ECB following.
Contrarians argue earnings growth undercuts the bubble narrative.