UBS says AI fundamentals remain intact, tech should continue to outperform
climbing 2.1% in just the first two days. Similarly, tech stocks recovered some of their losses, with the Nasdaq rising by 2.6%.
“However, we believe fresh numbers and company guidance this week are likely to further solidify our positive view on the AI theme and the global tech sector overall,” they added. “German software company SAP this week reported a 25% growth in cloud revenue fueled by AI demand, pointing to a strong AI monetization trend that we expect to see more evidence of this week,” strategists wrote.
Strategists believe that with the sector potentially exceeding its estimated 18% year-over-year earnings growth for the year, the recent 10% correction in valuations presents “an attractive entry point for investors looking for long-term opportunities.”
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