An AI bubble is no longer Wall Street’s biggest fear. This stock-market risk just took its place.

Bank of America's latest global fund manager survey shows that concerns about a "disorderly rise" in bond yields have overtaken fears of an AI bubble as the top perceived risk to stock markets. The shift is notable because it suggests professional investors are looking past valuation debates in technology shares and focusing instead on the cost of money itself.

Bond yields set the baseline against which most assets are priced. A sharp, disorderly move higher can compress equity valuations, tighten financial conditions and unsettle markets that have grown used to a particular range of rates. The word "disorderly" matters here: an orderly climb tied to solid growth is one thing, but a rapid, volatile repricing is another, and it is the latter that survey respondents appear to fear.

For observers, the takeaway is that macro conditions, not just the AI narrative, are driving sentiment. What to watch: the pace and volatility of yield moves, central-bank commentary, and whether any yield spike is accompanied by broader stress in credit markets.