J.P. Morgan is warning of potential dangers in the AI market, citing signs of investor exuberance and concentration risks. The bank notes that just 42 AI companies are driving a large portion of the S&P 500’s profits, and the semiconductor rally is showing similarities to the dotcom bubble. Hedge funds and retail traders are heavily invested in chip and hardware stocks, and leveraged chip ETFs are amplifying price swings. Why it matters: this trend could lead to a significant market correction, with some experts warning that an AI crash could be even more severe than the dotcom bust.