December 2024 | To date, the US tech winners have been those companies that are engaging in substantial AI investments. The question is how and/or when will these be monetized. In the US, we expect a reset of the tech sector valuation levels, and we prefer to diversify risk away from monothematic AI plays. Specifically, leading memory players are building up capacity in high-bandwidth memory, which supports the training of AI models, and there could be a risk of over-capacity. There is also a greater focus on geopolitics among investors, and share price volatility could increase in 2025 as Trump's government is inaugurated. The primary issues are tariffs, revisions to the US Chip Act and a fall in China-US relations, all factors that could hurt the semiconductor supply chain globally.
01 | To date, US tech winners have been those companies that are engaging in substantial artificial intelligence (AI) investments.
02 | The question is how and/or when will these investments in AI be monetized.
03 | This dominance is beginning to equalize as earnings growth from the top stocks slows and the rest of the market accelerates, a process we expect to continue into 2025.
Unless otherwise stated, all information contained in this document is from Amundi Asset Management as of December 3, 2024. Diversification does not guarantee a profit or protect against a loss. The views expressed regarding market and economic trends are those of the author and not necessarily Amundi Asset Management and are subject to change at any time based on market and other conditions, and there can be no assurance that countries, markets or sectors will perform as expected. These views should not be relied upon as investment advice, a security recommendation, or as an indication of trading for any Amundi product or service. This material does not constitute an offer or solicitation to buy or sell any security, fund units or services. Investment involves risks, including market, political, liquidity and currency risks. Past performance is not indicative of future results. Amundi US is the US business of Amundi Asset Management.
