In a note to clients, Goldman Sachs referred to the performance of major AI-related companies that fell on the stock market in recent days. But one key piece of data generated some hope for investors.
The actions related to artificial intelligence They have taken a beating recently, but with the imminent drop in rates of interest and still solid foundations, the trading desk at Goldman Sachs Group Inc.. think it’s time to buy again.
“We expect lower interest rates to support IT projects, economic policy to be less uncertain following the election and tangible progress on AI products to be unveiled at upcoming conferences,” Goldman Sachs strategist Faris Mourad wrote in a note to clients on Thursday.
Goldman’s broad array of AI stocks — which includes companies such as Nvidia Corp, Microsoft Corp, Apple Inc, Alphabet Inc, Amazon.com Inc, Meta Platforms Inc and Oracle Corp — It has accumulated a drop of 11% since its 2024 peak on July 10The weakness extends beyond the Magnificent Seven. Goldman Sachs previously launched two portfolios focused on booming demand for data centers and energy to fuel AI development.
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Expectations that the Federal Reserve will cut interest rates by half a point at its meeting on Wednesday have fueled a rotation of large-cap technology stocks into economically sensitive sectors of the market. In addition, the latest earnings season showed that corporate spending on artificial intelligence is not paying off as investors had hoped.
Why is it a good time to buy AI stocks?
Although this has caused fear in some, For Goldman Sachs, it is a buying opportunity.
“There is too much pessimism about AI,” Mourad wrote. “IA stock is cheap relative to year-to-date earnings trends, and would require further bad news to push it lower, which we believe is unlikely.”
Fundamentals play a key role in Goldman Sachs’ thesis. The bank expects AI companies’ net earnings to be nearly double in the next 12 months. He also sees further growth in technology-linked power generation.
Which AI stocks can you invest in?
If you want to invest in AI, the most obvious but also riskiest and most complex option is to opt for the direct investment in companies that use this technology through the purchase of shares. Some of the most common actions when investing in artificial intelligence are:
- Nvidia
- Microsoft
- IBM
- Samsung
Source: Ambito
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