AI Rally Stokes Bubble Fears; Tesla Touted

AI enthusiasm has driven a stock rebound but left markets highly concentrated and volatile, with Nvidia dominant in chips and a few cloud providers and LLM developers controlling hosting and R&D. Analysts point to investment opportunities beyond large language models — notably robotaxis, drones/UAM, space infrastructure, quantum and advanced nuclear — but these frontier themes face long timelines, heavy capex, regulatory hurdles and geopolitical risk. Wedbush analyst Dan Ives calls Tesla the most undervalued pure AI play and projects a potential $3 trillion market cap as autonomous driving and robotics scale, even as Tesla has ceded EV share to BYD and posted weak quarterly results. Veteran investors warn valuations look frothy — Bill Smead compared current AI market dynamics to the late‑1999 dot‑com mania and cautioned that severe drawdowns could follow. Nvidia’s centrality, surging venture funding, rising consumer energy bills from data centers, and macro drivers such as potential Fed rate cuts and retail-driven momentum mean selective, diversified exposure remains critical amid ongoing volatility and opportunity.