SoFi head of investment strategy Liz Young Thomas joins Morning Brief to discuss the state of corporate spending as recession fears float around Wall Street.

"We've seen a tone shift, which has been interesting in the market where earlier in the year and last year, companies were getting rewarded for throwing a lot of CapEx [capital expenditures] money at AI, and now investors are getting more discerning about what they'll accept in CapEx from AI without more of an ROI [return on investment], proof of where the profit is going to come from," Thomas explains. "So there's been a little bit more scrutiny on that."

Overall, she notes that companies are still performing well and that earnings have been "strong and stable." She adds that investors have been rewarding stock prices according to companies' cost control measures. As anxiety grows around the return on AI investments, she expects AI spending to experience a pullback while companies focus on maintaining operating margins.

For more expert insight and the latest market action, click here to watch this full episode of Morning Brief.

This post was written by Melanie Riehl