As AI Spending Soars Markets Question Returns

Hyperscalers are projected to spend 92% of their cash flow on AI capex by 2026, triggering a technical correction in Mag 7 stocks and credit market anxiety.

Key Takeaways

• 1.Hyperscaler capital expenditure is projected to consume 92% of their total cash flows by 2026.
• 2.The Magnificent 7 (Mag 7) stocks have entered a technical correction, dropping more than 10% from October highs.
• 3.Amazon experienced a significant $470 billion market capitalization loss over nine days following the announcement of a $200 billion capex plan for 2026.

Table of Contents

• As AI spending soars, Miss Market starts asking about the returns
• Eating almost all cash
• Technical correction
• Must hold
• Amazon
• Meaningful Mag7 selling
• Is there a pause coming up?
• Hyperscaler debt
• How the credit trades it

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