Cathie Wood Sees Trump Era Sparking Revival in Corporate Risk Appetite

• Cathie Wood of ARK Investment Management sees U.S. companies increasing capital spending and risk-taking, driven by expectations of Trump’s deregulation and tax cuts, with Meta Platforms Inc. (META) investing in AI startup Scale AI as a key example.
• ARK’s $6.3 billion Innovation ETF, up nearly 12% this year, reflects this shift, with Wood remaining bullish on Tesla Inc. (TSLA) as a leader in AI-driven autonomous driving, while predicting a stronger U.S. dollar amid corporate rebalancing.

Corporate America is poised for a surge in risk-taking, driven by expectations of deregulation and tax cuts under President Donald Trump, as reported by Bloomberg. Cathie Wood, founder of ARK Investment Management, highlighted this shift during Bloomberg’s Trumponomics podcast at the Founders Forum Global conference in Oxford, pointing to increased capital spending by major U.S. firms. She cited Meta Platforms Inc.’s (META) investment in AI startup Scale AI as evidence of companies pivoting toward innovation-driven strategies. Wood noted that the dominance of megacap tech stocks in recent years stemmed from investors seeking safety amid regulatory uncertainty under the Biden administration, a trend she believes is waning.

Speaking alongside Bloomberg Editor-in-Chief John Micklethwait, she observed that investors in these firms, once drawn to cash-hoarding giants, are now embracing a rebalancing toward growth-oriented opportunities. ARK’s $6.3 billion Innovation ETF, focused on disruptive technologies, has gained nearly 12% this year, outperforming the S&P 500 (SPX), though it lags over longer periods. Wood remains steadfastly bullish on Tesla Inc. (TSLA), the ETF’s largest holding, describing it as “the largest AI project on earth” due to its advancements in autonomous driving. ARK has recently increased its Tesla stake after earlier reductions, signaling confidence in its long-term potential. Wood also suggested that the U.S. dollar could see renewed strength as corporate risk appetite grows, despite some investors rotating out of U.S. stocks due to high equity valuations. This evolving landscape reflects a broader recalibration in corporate strategy, with firms leveraging a potentially lighter regulatory environment to pursue transformative investments in AI and other cutting-edge technologies.

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