MarketWatch, in an article published on May 10, 2026, said that rising AI-related capital spending by Big Tech is reducing the scope for the kind of shareholder payouts that have helped support U.S. equities in recent years. The original report is available from www.marketwatch.com at https://www.marketwatch.com/story/big-techs-ai-spending-is-depriving-investors-of-juicy-payouts-39d17305.
According to MarketWatch, the issue is not limited to one stock or one earnings cycle. The article says that heavier AI investment and a less linear macro environment are compressing the potential for buybacks and distributions, and it cites Goldman Sachs expecting S&P 500 buyback growth of just 3% this year.
Why this matters for active traders: buybacks have been an important technical support for U.S. equities, especially when market leadership is narrow and concentrated in mega-cap technology names. If more cash is directed to capex instead of repurchases, valuation support can become more sensitive to real rates, earnings delivery and any disappointment on AI execution. That makes the story relevant not just for single-name traders, but also for index, sector and cross-market positioning.