Bank of America: AI Capital Expenditure Has Not Peaked, Monetization Determines Returns

Bank of America estimates that AI capital expenditures continue to rise, but whether monetization can cover the cost of capital will determine returns. The S&P 500 offers a balanced risk-reward profile over the next 12 months, with a long-term bullish outlook on U.S. equities; the firm is overweight on Information Technology and Communication Services, favoring AI adopters, commodities, and physical infrastructure build-outs.