Ray Dalio says AI market shows signs of bubble

Billionaire Ray Dalio warned that the booming AI market shows signs of a bubble that could eventually burst, saying major tech revolutions typically create speculative excess. His comments highlighted a trade-off companies face between heavy spending to capture AI market share and preserving profitability — a factor Dalio flagged as a potential trigger for a correction. The article singles out chipmakers (notably Nvidia) as key beneficiaries of AI demand; traders may reprice richly valued AI/semiconductor names and broader tech indices if profitability concerns or capitalisation delays emerge. Given Dalio’s stature, his remarks could amplify short-term volatility and prompt cautious positioning in AI-related stocks and tech indices, increasing downside risk even as the sector remains a market leadership theme.