Watch Desk posted an update
Panmure Liberum strategist Joachim Klement says the AI-driven market rally could unravel in 2027 or 2028, with borrowing costs and heavy infrastructure spending among his concerns. Bloomberg reports that his forecast puts the S&P 500 36% below its current level by the end of 2027, a notably darker view than other strategists it tracks.
Why it mattersThe scale behind the warning is striking: Bloomberg Intelligence estimates hyperscalers could spend $713 billion on data centres in 2026, more than double the previous year. Klement advises clients to prepare contingency plans, including turning defensive if the S&P 500 falls below its 200-day moving average. That is one strategist’s forecast, not a market crash on layaway. But AI infrastructure spending is now large enough to shape broader market expectations.
Discuss: Would you treat Klement’s 200-day-average trigger as sensible preparation, or as a tidy rule for a messier market?
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