Published On 7/7/2026
Global markets are witnessing an unprecedented wave of capital flows towards a limited number of giant companies, in a shift that is redrawing the map of business and investment, but at the same time raising growing fears of the concentration of economic power and rising systemic risks, according to an analysis published by The Economist.
The newspaper pointed out that giant acquisition deals, huge financing rounds, and foreign direct investments have become increasingly concentrated in a limited number of companies, driven by the boom in artificial intelligence, the accumulation of liquidity, and changing government policies.
Artificial Intelligence is leading the era of mega deals
According to data reported by the newspaper, mergers and acquisitions deals worth more than $10 billion constituted about 48% of the total value of global deals since the beginning of the year, which is the highest percentage ever recorded.
Funding rounds worth more than $1 billion accounted for 61% of total venture capital funding, while major companies participated in about four-fifths of these rounds, reflecting the increasing reliance of startups on major strategic investors.
The same trend extends to foreign direct investments, as new projects with a value exceeding one billion dollars represent about 42% of total investments since the beginning of 2024, compared to only 28% during the period between 2016 and 2018.
The United States remains the main driver of this wave, as it accounts for the largest share of giant acquisition deals, and includes most of the startup companies that received the largest funding rounds, while Taiwan, the Emirates, China, Singapore, and Britain have also emerged as centers for huge investment deals.
The newspaper believes that this boom reflects the abundance of liquidity among major companies, as the cash balances of Standard & Poor’s 500 index companies amounted to about $2.2 trillion, coinciding with the profits of American companies reaching historic levels compared to the gross domestic product, which provided them with a greater ability to carry out acquisitions and finance expansion.
Artificial intelligence is the most prominent driver of this wave, as the newspaper expects that the major cloud computing companies, namely Alphabet, Amazon, Meta, Microsoft, and Oracle, will spend about $800 billion on capital spending during the current year to expand data centers and infrastructure supporting artificial intelligence, in addition to funding emerging companies operating in this sector.
Concentration risks and increased leverage
The Economist believes that the political environment also contributed to accelerating this trend, with the new US administration and the European Union adopting more flexible positions towards mergers, in parallel with protectionist policies that push companies to resettle production through incentives and customs duties.
Geopolitical uncertainty and rapid technological changes also prompted company management to consider large size as a means to enhance the ability to confront risks, which raised the valuations of giant companies compared to smaller companies.
But the newspaper warns that this concentration carries increasing risks, as studies indicate that the chances of success of major merger deals do not differ much from smaller deals, while the cost of failure is much higher due to the huge amounts of debt and financial obligations.
She explained that major technology companies have begun to rely increasingly on borrowing to finance their investments in data centers, after previously relying on self-cash flows, which increases levels of financial risk.
These developments are reflected in the American economy, as the largest 10% of listed companies now own more than three-quarters of the market value of shares, which is the highest percentage in a century, according to data reported by the newspaper from Deutsche Bank.
The Economist believes that this focus makes the markets more fragile, as the failure of one giant company burdened with debt may lead to widespread turmoil in the financial markets, in addition to the growing influence of large companies at the expense of consumers and small suppliers, which may fuel the rise of populist tendencies and undermine confidence in the market economy.
