"AI-Driven Tech Stock Rally to Continue Next Year... Apple to Jump 30%"

As the artificial intelligence (AI) boom that has driven the rise of U.S. tech stocks continues, an analysis suggests that the U.S. stock market will maintain its rally (bull market) next year as well.

Daniel Ives, an analyst at Wedbush Securities and a leading optimist on Wall Street, stated in a report on the 13th (local time) that "AI-related spending will increase by more than 20% next year compared to this year," forecasting accordingly. He said, "The impact of AI on corporate earnings is currently being underestimated," and predicted that "with a surge in spending on AI applications, Apple’s stock price, which has benefited from this, will rise nearly 30% next year."

He evaluated AI as the most innovative technological trend since the internet era began in 1995, and anticipated that "a $1 trillion market will be formed in AI semiconductors and software over the next decade."

[Image source=Reuters Yonhap News]

With funds betting on further rises in AI tech stocks pouring in, the Nasdaq 100 index has surged 41% so far this year. The S&P 500 index rose by 15%. Despite heightened macroeconomic uncertainties such as the prolonged high interest rate policy of the U.S. Federal Reserve (Fed) and the sharp rise in U.S. Treasury yields, strong earnings expectations centered on big tech have boosted investor sentiment, analysts say.

Ives believes that as AI monetization begins to be reflected in corporate earnings, it will provide additional upward momentum for stock prices. He recommended stocks including Apple, Alphabet (Google), Palo Alto Networks, cloud security firms Zscaler and CrowdStrike, along with MS and Palantir.

Apple, a latecomer to AI, plans aggressive investments, spending $1 billion annually on AI development to narrow the gap with leading companies such as MS, Google, and Amazon. MS announced in its Q3 earnings report that after integrating OpenAI’s AI technology into its cloud service Azure, the number of customers increased, resulting in a 26% year-over-year surge in revenue.

Ives said, "Now is the right time to invest in AI tech stocks." Although the Nasdaq 100 index has fluctuated since peaking in July, its closing price remains below the historic high of 16,573.34 set in November 2021. He added, "The growth outlook for AI tech stocks remains solid," and "With a flood of short-covering from short squeeze liquidations, tech stocks could surge sharply."

This content was produced with the assistance of AI translation services.