On the day that SpaceX made the largest stock market price in history, the market below it has nerves. The reason is not the rockets. This is AI’s place.
Several warning lights flash at the same time. Together they amount to the first serious test of the trade that has dominated global markets for two years.
The clearest signal is in the software. Wall Street has spent 2026 living through what traders at Jefferies are calling the ‘SaaSpocalypse’, a selloff that, by some estimates, has wiped about $2tn off the S&P software index since its 2025 peak.
Fear is direct. If AI agents can do the work of a sales team, the company needs far fewer software seats, and the per-seat licensing model that makes up modern software starts to falter.
Private-equity giant Apollo turned that fear into policy. It now evaluates software deals for the risk of AI migration, holds private-equity software exposure, and keeps software less than 2 percent of its assets.
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Your thinking is concentration. Software grew from about a tenth of global purchasing volume to about 40 percent at its peak, a level Apollo called a ‘very important red flag’.
Fear is spreading
It’s not just software anymore. Stocks in Hong Kong and mainland China fell on Wednesday, with technology stocks among the hardest hit, as fears of an AI-bubble tracked the pullback on Wall Street.
In Washington, Senator Elizabeth Warren introduced a bill, the AI Bubble Transparency Act, that would force banks to disclose their debt and equity exposure to chip makers, data centers and hyperscalers. He posits the focus as a systemic risk.
And KKR’s chief strategist, Henry McVey, told clients that the boom was real but would make the economy ‘more extreme than anything we’ve seen since the second industrial revolution’ in the 1870s.
Some sectors are ‘starving’, he wrote, while a few, technical services, high-level and government, are operating ‘changed’. For protection and strength, the company considers them to be the most successful for a long time.
Underneath it all sits capex. Hyperscaler infrastructure spending is approaching $660bn this year, the largest corporate investment program in history outside of wartime, and largely funded by debt.
Amazon’s borrowing exceeded $225 billion, and Oracle recently exceeded its capex guidance, with tens of billions more to come.
The bear bag is simple. Using this scale only pays off when AI moves from ‘copilot’ features to autonomous agents that prove to be the next order of magnitude of computing. If acquisitions mount, the return on $660bn a year falls below the cost of capital.
The bull case is also true. This is not 2000.
As TNW previously noted, valuations and concentrations remain above dot-com peaks on other measures, with the CAPE ratio nearing 38. But unlike the dot-com darlings, today’s leaders are very profitable, and the capex cycle has not yet begun to produce results.
The honest answer to ‘is this a bubble?’ that no one can know until the use of money brings or not. What has changed this week is that the market has started to ask this question aloud, after two years of not wanting to.
SpaceX is not an AI company. But its launch, and the OpenAI and Anthropic listings that follow behind it, will be the closest thing to a real-time interview on whether investors still believe. Even market watchers who think the list won’t ‘break’ the bull market, as CNBC puts it, are not comfortable about what comes after it.
Loose is not a crash. But for the first time in a while, the people writing the checks are openly weighing the question that the boom has raised: what exactly is coming back?
