1157 GMT - European equity valuations are elevated on overly optimistic assumptions around the artificial intelligence-driven investment boom, Bank of America analysts write. Markets price record margin expansion and post-recession levels of earnings per share growth over the next three years, the analysts say. "We see ample scope for disappointment." Increased competition between model makers will reduce pricing power and lower margins--the same factor that has caused past tech booms to fall flat, they say. Moreover, the increased cost of money for hyperscalers, and the risk of insufficient electricity supply, will drag data center build-out on the continent. The analysts see potential for the Stoxx 600 to fall by 9% to around 580 into early 2027. The index rises 0.55% to 639.49 Friday.