The Air in the Bag | Steve Henderly, CFA
Printer Friendly PDF: November 2026 Commentary
Sealing air inside a bag of potato chips serves a purpose. It protects the deliciously salty snack from becoming a pile of crumbs. Over the last several years, enthusiasm for artificial intelligence provided a similar cushion for stocks, especially semiconductor “chips” and the technology giants building AI infrastructure. The prevailing view was that the growth opportunity was so compelling that even higher interest rates would do little to slow it. Is some of the air starting to escape the bag?
We see October’s reassessment as healthy. Interest rates are a bit like gravity in investing. Even businesses with strong growth prospects feel the drag. As inflation and borrowing costs are elevated, it appears investors are beginning to ask more pointed questions about how much AI spending companies can justify. Here’s what stood out in October.