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Investors Wary as AI Sector Faces Regulatory Risks

12/29/2025

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Story summary
  • Investors remain cautious about the AI sector despite rising stock prices.
  • Some new AI firms face borrowing costs about 3.75 percentage points higher than peers.
  • Major firms plan to spend over USD 320 billion on AI infrastructure in 2025.
  • China is drafting rules to regulate AI services, increasing regulatory risk.
  • Industry leaders warn that unchecked AI could trigger a market collapse unless spending and regulation are monitored.