Wednesday, May 29, 2024
HomeEconomyTech's Big Comeback: The Rally Awaits, Says Wedbush Analyst

Tech’s Big Comeback: The Rally Awaits, Says Wedbush Analyst

Dips, dives, and declines – the stock market’s roller-coaster ride can be enough to make even the savviest investor’s head spin. But for those with a keen eye on the tech sector, the winds of change might be blowing in a lucrative direction. With a backdrop of robust Q2 earnings and a rather ‘relaxed’ Federal Reserve, the tech bull market seems to be charging forth, says Wedbush’s Dan Ives.

Now, let’s address the elephant in the room – that pesky 6% dip the Nasdaq 100 took from its recent zenith. Ives suggests that this isn’t a time for panic, but an opportune moment to buy into tech. Why, you ask? Because according to Ives, the tech sector is warming up for a sizzling 12% to 15% rally as we head toward the end of the year.

Powering this bullish stance are the impressive Q2 results from the tech behemoths like Amazon, Microsoft, and Apple. But there’s another player on the field that’s creating a significant buzz – artificial intelligence (AI). With AI becoming the talk of the town, Ives perceives it as a transformative force, reshaping both the enterprise and consumer arenas. He says, “The winners and losers in the backdrop are quite evident, with AI front and center.”

Drawing parallels with the Internet’s impact in 1995, Ives believes the emergence of AI is a groundbreaking development with far-reaching consequences. Companies dabbling in the cloud, cybersecurity, and digital advertising are predicted to ride the AI wave, experiencing tailwinds similar to those in the internet’s early days. Ives quips, “The AI build-out is monumental, reminiscent of the Internet’s ripple effect in ’95. And we’re just getting started.”

But that’s not all. The tech sector’s propulsion could be further boosted by the Federal Reserve’s stance. With the July CPI report hinting at subdued inflation, it seems the Fed may hit the brakes on interest rate hikes in their upcoming September meeting. Some even whisper about potential rate cuts on the horizon.

The bottom line? Ives sees the lights turning green for risk-takers as the year progresses. He anticipates that we’re merely at the midpoint of a tech bull market set to roar for the next 12-18 months.

If Ives’ forecast materializes, we might witness the Nasdaq surge to dizzying heights, potentially unseen since 2021’s finale. For investors and tech aficionados, the next move might just be critical. So, will you join the rally?