As OpenAI continues its expansion and drives tech stock gains, investor sentiment is running high. However, an increasing number of Wall Street professionals are concerned that the dramatic rallies capable of adding tens of billions of dollars in market value within minutes are sending unhealthy signals, reminiscent of the internet bubble era.

AMD experienced such a "rocket-like" surge on Monday. The chipmaker's stock soared after striking a deal with OpenAI, with the company's market value temporarily increasing by approximately $100 billion at intraday highs; the agreement could potentially generate billions in revenue. Previously, Oracle surged 36% in a single day last month, adding $255 billion to the software company's market value overnight, triggered by particularly strong guidance for its cloud business, including a five-year, $300 billion agreement with OpenAI.

"If any of these deals fall through, I think it would trigger a concerning chain reaction downstream," said Brian Mulberry, client portfolio manager at Zacks Investment Management Inc., which manages approximately $12 billion in assets. "It reminds me of the telecommunications industry situation in the mid-1990s."

These developments come amid growing concerns that an artificial intelligence bubble may be forming. Key industry players — Nvidia and OpenAI — are striking multi-billion-dollar deals with a range of companies involved in related infrastructure. As investments continue to escalate, fears are mounting that this trend could end in a crash similar to the internet boom 25 years ago, when massive investments based on optimistic internet traffic expectations materialized far more slowly than anticipated.

If a bubble correction begins now, the impact could be more severe, as major tech stocks collectively represent approximately 35% of the S&P 500 index, compared to less than 15% in 1999.

"The market is pricing these deals as if simply having dealings with OpenAI guarantees success," said Michael O'Rourke, chief market strategist at Jonestrading. "OpenAI is a company with negative cash flow, so signing these agreements poses no loss for them. Investors should be more discerning. But the current environment is 'buy first, ask questions later.'"

Hedge fund billionaire Paul Tudor Jones said Monday that the current environment reminds him of the internet bubble period.

"All the conditions are in place for some form of explosion," he said. "Will it repeat? History is remarkably similar, and I think it will happen again in some version," describing the current environment as "potentially more explosive than 1999."

Mulberry noted that a major concern about these deals is their circular capital structure, with companies using each other's funds to purchase each other's products.

Additionally, the dramatic price volatility of these massive companies is also alarming. He said these are companies with "large and mature balance sheets" participating in such rallies, which "is uncommon and truly thought-provoking."

Of course, AMD's surge may be justified, as the OpenAI agreement represents significant progress in graphics processing units (GPUs), where AMD is competing with Nvidia for market share. Wall Street analysts tracking AMD have generally welcomed the news.

"This agreement fundamentally changes how the industry will view AMD's competitive position going forward," Benchmark analyst Cody Acree wrote in a client report Monday, raising the company's target price from $210 to $270. "Beyond the obvious revenue and earnings enhancement this agreement brings, we believe this news provides strong validation for AMD as an increasingly competitive viable technology alternative to Nvidia's AI GPUs."

Nevertheless, multiple large tech stocks recording double-digit gains in such short timeframes may indicate valuations have detached from fundamentals, with investors buying more out of fear of missing subsequent rallies.

"Price discovery is actually quite frightening," said Ted Mortonson, tech strategist at Robert W. Baird & Co., following Oracle's surge.

For such a large company to gain such massive market value in such a short time is "neither normal nor good," he added. "I would categorize this as 'excessive exuberance.'"