Tech Stocks Poised to Rally Through 2024 on AI Promise, Says UBS
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Investors' enthusiasm about AI will strengthen tech stocks and semiconductors through 2024 and the next decade, says UBS. Global AI revenue seen rising 15x to $420B by 2027.
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Taiwan Semiconductor Manufacturing (TSMC) recently posted better-than-expected profits on demand for AI chips. Its shares surged nearly 13% last week.
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UBS says high valuations for mega cap tech stocks are justified by the evolution of semiconductors and exposure to megatrends.
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The S&P 500 hit a new record high on Friday, emerging from a painful two-year market period. In the 1-3 years after new highs, returns have historically averaged 12-39%.
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UBS expects a "digestion phase" for stocks in the near term, but the rally could extend further in 2024 on signs of a soft economic landing and earnings growth.