The market narrative on 23/05 is becoming increasingly complex.

AI optimism continues pushing capital into Nvidia, Microsoft, and major hyperscalers, but rising Treasury yields are starting to pressure the same growth stocks that benefited most from the AI rally.

Reuters recently highlighted that global bond yields are climbing as markets reassess inflation risks, energy prices, and the long-term impact of massive AI-related capital expenditure. Some analysts now believe the AI boom itself could contribute to structurally higher interest rates due to enormous infrastructure investment demand.

At the same time, global equity funds just recorded their first weekly outflow in nine weeks as investors reacted to surging yields and persistent macro uncertainty. Yet technology funds still attracted strong inflows, showing that capital is not leaving AI — it’s becoming far more selective.

This creates an unusual environment:
• AI continues driving growth expectations
• But higher yields are compressing valuation multiples

To me, the market is entering a phase where “AI dominance” alone may no longer be enough.

The next winners will likely be companies capable of sustaining AI growth while surviving a structurally higher-rate world.
#PostonTradFi