Investors are getting more cautious about artificial intelligence (AI) stocks. After years of excitement and heavy investment, they’re now looking closely at how companies are spending money and when those big investments will start paying off. At the same time, the U.S. stock market is seeing growth outside of just the big tech names. Other sectors, commodities, and smaller companies are showing strength too.

Big tech stocks are still popular, but there’s a shift happening. Some companies, like Oracle, are still in the game — especially with news like its role in the TikTok deal — but others are falling behind. Investors are paying more attention to how these companies fund their AI projects. If a company uses its own profits (free cash flow) to build AI tools, that’s seen as a good sign. But if they’re taking on debt to do it, investors are becoming more skeptical.

For example, companies like Oracle and Cloudflare rely more on debt, which raises concerns. In contrast, Nvidia is a standout — it benefits directly from AI spending and is already making solid profits. Investors are starting to separate winners from those that might not keep up. This shift started becoming clear in recent months.

Take Meta (Facebook’s parent company) as another example. Its stock had a great run, but now there’s concern over how much it’s spending on AI. They’ve moved away from the metaverse idea but are putting a lot of money into large language models. Since Meta mainly makes money from ads, people are wondering how it will turn these big investments into profits. That question will likely be a big focus in the coming year.

On another note, there’s growing concern about crypto scams, especially in Canada. Some fake ads on platforms like Facebook even use fake endorsements from public figures like the Prime Minister to trick people. While Bitcoin and Ethereum are more established — and now have spot ETFs — newer coins and projects carry much more risk. These unknown cryptocurrencies are where most of the scams happen.

Looking at earnings trends, something interesting is happening. For a long time, most of the growth came from just a few big tech names. Now, earnings across all 11 sectors of the S&P 500 are positive for the year — and five sectors are keeping pace with the index itself. That’s a big improvement from last year when only two sectors were positive.

Smaller companies (small caps) are also doing well, outperforming larger ones since September. In fact, their earnings outlook is better than the broader S&P 500 for the next couple of years. Investors are beginning to pay attention to companies beyond just the top seven mega-cap names.

Gold has also made a big comeback. It’s now the top-performing group in the S&P 500 Gold Index — up about 173% this year. This breakout was a long time coming — 10 years on a nominal basis and nearly 40 years after adjusting for inflation. More investors are jumping in, helped by easier access through ETFs like GLD. Central banks are buying gold too, especially after geopolitical tensions like Russia’s invasion of Ukraine shook up global financial systems.

Another surprise winner is GE Vernova — part of General Electric’s spinoff strategy. It’s in the power infrastructure space and has doubled in value this year. With huge energy needs from data centers and AI models, demand for power equipment is rising fast. GE Vernova has positioned itself well to meet that demand. Other GE spinoffs like GE HealthCare are also doing well, showing that these breakups can be very successful.

Overall, we’re seeing a broadening market where investors are looking beyond just AI hype and focusing on real growth, strong earnings, and long-term trends like energy infrastructure and gold.