Add as a preferred source on GoogleHartnett Sees Opportunity in Beaten-Down Technology Bonds
The Bank of America strategist sees higher yields as AI-related borrowing grows, after previously highlighting stress in CoreWeave debt.
Bank of America strategist Michael Hartnett sees potential value in beaten-down technology debt as borrowing tied to artificial intelligence pushes yields higher.
The view follows Hartnett’s earlier warnings about AI-related credit stress. He highlighted distressed CoreWeave bonds and five-year credit default swap pricing that implied about a 63% default probability. That figure was a market-implied measure, not an actual default rate. The AI credit market had also recorded its weakest week of the year.
Hartnett’s latest view centers on technology bonds, while his earlier comments addressed risks to the broader technology trade. He has said semiconductor prices could help determine whether investors return to technology stocks around mid-November. In that outlook, falling chip prices could point to tighter AI credit and slowing capital-spending growth, a backdrop he said could favor bonds.
Hartnett’s earlier comments on technology stocks, chip prices and AI credit stress are covered in this report.