Top JPMorgan Strategist Michael Cembalest Is "Cautious" on AI Stocks. Should You Change Your Investments?
A well-regarded stock market strategist says that something worrisome is happening with semiconductor stocks and AI hyperscalers.
Overview
In his July 22 "Eye on the Market" report, influential JPMorgan (NYSE: JPM) strategist Michael Cembalest writes that he is turning "cautious" on U.S. equity market technicals by looking at recent trends in the artificial intelligence (AI) trade.
Cembalest notes in his research that semiconductor stocks have recently made big gains while hyperscalers have stagnated. As he writes, "The worrisome part of a boom cycle is when companies closest to final demand roll over, even as capital spending beneficiaries of the cycle keep on thriving."
Details
For example, in the past year, the iShares Semiconductor ETF has delivered a return of 89.75%, strongly outperforming AI hyperscaler stocks like Alphabet, Amazon, Meta, Microsoft, and Oracle.
Source
Originally published at www.fool.com.