For a stock that hit a fresh all-time high as recently as the start of November, it may come as a surprise that there's a bearish argument at all calling for a sell-off.

Shares of Microsoft and Amazon came under renewed pressure on Tuesday as a rare analyst downgrade and fresh regulatory scrutiny from the European Union weighed on two of Wall Street's most influential technology stocks.

Bank of America, in a survey of global fund managers released Tuesday, found the largest perceived risk for markets is that AI stocks are in a bubble, with concerns some companies are over-hyped and disconnected from their real value. An AI bubble was viewed as the top risk by 45% of investors surveyed by Bank of America, and a majority of respondents expressed concerns that companies were overinvesting for the first time since 2005.

The bull case for generative AI may be losing steam. Analyst Alexander Haissl at Redburn is cutting his ratings on Microsoft and Amazon to neutral, saying the Gen-AI boom is NOT the next cloud.

While demand for AI computing remains high, the economics are deteriorating for Amazon and Microsoft, which now must spend six times more capital to generate the same value as before, according to one analyst.

Anyone who thought the surge in artificial intelligence spending might ease should look away now. UBS notes that America's big four cloud providers have unveiled yet another round of eye-watering investment plans.

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