Wedbush

The Federal Reserve’s decision to lower the federal funds rates rate by 50 basis points is a “very bullish backdrop” for a risk-on trade of big tech companies and artificial intelligence heading into 2025, Wedbush said in a note Thursday. The rate cut was the “missing piece” in the puzzle as a lot of investors were looking for a green signal for the tech growth trade into this year’s end and 2025, analysts led by Daniel Ives wrote. The tech supply chain is preparing for a huge growth period ahead as roughly $1 trillion of artificial intelligence capital expenses are expected to be on the horizon in the near future, the analysts said. “We continue to strongly believe its 9 pm in the AI Party that goes till 4 am,” Wedbush said. Alongside Nvidia (NVDA) and Microsoft (MSFT), many other tech companies are joining the AI party including Oracle (ORCL), […]

With the tech supply chain gearing for unprecedented growth driven by the roughly $1 trillion of AI capex, the stage is set for tech stocks to rise into year-end and 2025, Wedbush analysts say in an industry note. The analysts estimate that for every $1 spent on an Nvidia GPU chip, there is a $8-$10 multiplier across the tech sector. While Nvidia and Microsoft are core drivers of AI, many other tech companies including Palantir, Salesforce, Dell, IBM, Apple, and AMD are now joining the AI party. “As more tech vendors show the monetization piece of AI this will ultimately drive the next leg of the tech bull market in a very stable overall IT spending environment that is a bullish backdrop for tech stocks in our opinion,” they add.