Amidst oil prices persisting above $100 per barrel and the Strait of Hormuz remaining disrupted, the macroeconomic backdrop has deteriorated with inflation and interest rate pressures resurfacing. Traditional frameworks suggest this environment is hostile for high-valuation technology equities, yet U.S. stocks have reached new highs while capital continues to flow into the AI sector. Song Xuetao, a macro analyst at Guojin Securities, characterized the current market state in a May 25 report as "rational exuberance," noting that while a bubble exists, it remains contained. The critical distinction lies in the shift from AI as an auxiliary tool to Agentic AI as an autonomous execution mechanism, creating a visible commercial closed-loop where capital expenditure transitions into revenue generation. Data compiled by Woofun AI indicates that this rationality is underpinned by surging token consumption and computing power demand, which have driven rapid growth in annual recurring revenue for leading firms, even as valuations price in growth expectations extending to 2027 and 2028.

As of May 20, the forward price-to-earnings multiples for the seven major U.S. technology companies stood at approximately 35 times, significantly outpacing the 25 times multiple of the remaining 493 companies in the S&P 500. This valuation premium implies that the pace of AI penetration must be 5 to 8 times faster than previous technological revolutions to justify current pricing. The market's tolerance for high capital expenditures has shifted; unlike previous cycles where unclear revenue pathways penalized heavy spending on data centers and GPUs, the emergence of autonomous agents like Openclaw and Claude Cowork has validated the investment thesis. Mid-year estimates cited in the report show Anthropic's annual recurring revenue forecast jumping from $9 billion at the start of the year to $44 billion, doubling every six weeks on average. If this trajectory holds, annual recurring revenue could exceed $300 billion next year, transforming hardware costs into a competitive moat for companies like Nvidia and Broadcom.

The resilience of AI assets despite rising oil prices stems from demand spreading across the entire industry chain, encompassing not just GPUs but also CPUs, optical modules, and storage solutions. Light Counting predicts that shipments of 800G transceivers will double in 2026, while 1.6T port shipments are expected to surge from low 2025 levels to tens of millions by 2026, with chipset sales exceeding $2 billion.

Concurrently, the earnings performance of tech giants has been exceptional, with the S&P 500 EPS growth rate hitting 27.1% in the first quarter, a high not seen since late 2021. Meta, Alphabet, and Amazon alone contributed 70% of the index's earnings growth, buffering the market against energy price shocks. Woofun AI notes that large technology firms are less sensitive to oil prices than sectors like aviation or logistics, focusing instead on electricity costs, which allows capital to flow into AI assets as a hedge when the traditional real economy faces pressure.

However, the primary danger lies in the velocity of valuation setting rather than a lack of industrial support. The current multiples assume a frictionless future where AI infrastructure expands continuously over the next 3 to 5 years, penetrating advertising, search, cloud services, and financial risk management without significant disruption. Historical precedents suggest such linearity is rare; electricity took 40 years and computers 25 years to achieve widespread adoption. The current market pricing requires AI to develop 5 to 8 times faster than these predecessors, leaving a narrow margin for error. If commercialization lags behind capital expenditure, or if depreciation and electricity costs erode margins, valuations will face immediate correction. The industry's directional correctness does not guarantee indefinite stock price appreciation.

In the short term, liquidity shocks pose the most immediate threat. Persistent closure of the Strait of Hormuz and oil prices above $100 could drive inflation from energy into services and raw materials, as evidenced by the U.S. Producer Price Index rising to 9.8% in April, the highest since October 2022. Such entrenched inflation could force the Federal Reserve to reconsider its policy stance, with futures markets pricing in a 0.8 percentage point rate hike this year. Woofun AI analysis suggests that doubts regarding Federal Reserve independence and internal FOMC divisions are further undermining confidence in future easing measures.

Additionally, Japan's role as a global financing hub is under strain; the Bank of Japan's tightening signals have pushed 30-year government bond yields above 4%, threatening to unwind global carry trades. A May 15 preview of this dynamic saw 10-year U.S. Treasury yields exceed 4.5% and 30-year yields surpass 5%, triggering a 4% single-day drop in the Philadelphia Semiconductor Index and a 1.5% decline in the Nasdaq.

The medium-term test will be the realization of these expectations within the real economy, requiring rapid organizational adaptation, workforce retraining, and successful business model implementation without significant social resistance. Technological revolutions typically follow a pattern of acceleration, deceleration, and re-acceleration, but current valuations demand a speed of adoption rarely seen in human history. Long-term constraints remain substantial, including energy and infrastructure bottlenecks where data centers require massive electricity and cooling water, potentially triggering regulatory scrutiny and public backlash.

Furthermore, employment concerns loom; if technological unemployment outpaces job creation, consumer purchasing power in non-AI sectors could weaken, ultimately stifling AI growth. Social acceptance is also a variable, with growing resistance in the U.S. to data center electricity costs and job displacement. Finally, hardware technology disruptions, such as breakthroughs similar to DeepSeek, could render current scarce components surplus, altering the bullish hardware trend. While the long-term potential for AI to boost productivity remains optimistic, the sustainability of the current bull market depends entirely on whether revenue growth and technological penetration can keep pace with tightening macroeconomic and social constraints.