It's too early to judge a long-term reversal for AI stocks... IMF warns of investment and borrowing risks

The International Monetary Fund said recent swings in AI-linked stocks are not enough to alter its longer-term view that AI firms’ profitability could be reassessed, with spokesperson Julie Kozack telling a Washington briefing that the fund’s earlier warnings remain in place. Kozack said the IMF is monitoring how AI investment and corporate borrowing could affect equity markets, the broader economy and financial stability. The comments matter because AI-related equities have become a major driver of global market valuations, so any repricing tied to doubts over long-term returns could spill over into credit conditions and growth. Investors should watch upcoming IMF assessments and AI firms’ earnings and capex guidance for signs of whether borrowing-funded investment is straining balance sheets.