The stock market has been ablaze with the buzz around artificial intelligence (AI), particularly the success of OpenAI‘s ChatGPT chatbot, which has led to a surge in interest from retail investors. As a result, any company that mentions ChatGPT or something about AI sees a rally, making it the hot buzzword of the month. Hedge funds and major investors, such as David Tepper and Bill Ackman, have piled into companies capitalizing on the AI race during the first quarter of 2023, including C3.ai and SoundHound.The increasing interest in AI is reflected in the earnings calls of big tech companies. In the first half of the 2023 earnings season, more S&P 500 companies mentioned AI in calls with analysts than any prior quarter in the past several years. However, the Federal Trade Commission has warned that companies ramping up AI efforts while cutting ethics teams “might not be a good look”.As AI technology continues to grow, experts are considering whether or not it is time to trim some of the big tech stocks. In this article, we will explore what experts have to say about the AI-driven rally in big tech stocks.
The AI-Driven Rally: A Wall Street Craze
The AI-driven rally has become the latest Wall Street craze, with shares of C3.ai Inc, BigBear.ai, and SoundHound AI extending their rally. These companies, along with others that develop AI-related technologies, have seen their tickers being bandied about on investor-focused social media platforms such as Stocktwits.com.The success of OpenAI’s ChatGPT has left investors searching for companies that capitalize on AI technology, leading to a surge in the value of AI stocks. C3.ai and SoundHound have both more than doubled in value this year. Hedge funds have also jumped on the AI bandwagon, with many beefing up their AI-related holdings in the first quarter of 2023.
The AI Frenzy: Is it Time to Trim?
The AI frenzy has led to a surge in the value of big tech stocks. However, as the interest in AI continues to grow, some experts are considering whether or not it is time to trim some of these stocks.According to CNBC, some experts believe that AI is now priced into many of the big tech stocks, and there may not be much upside left. As a result, some investors are considering trimming some of their positions in these stocks.
The Future of AI
Despite concerns about the AI-driven rally, the future of AI technology remains bright. As more companies capitalize on AI technology, we can expect to see further growth in this field.Leading businesses, such as Lemonade and C3.ai, have already made strides using AI technology to grow their respective businesses. The use of AI technology is not limited to the tech industry, with many other industries, such as healthcare and finance, also adopting AI to enhance their operations.
Conclusion
The AI-driven rally in big tech stocks has sparked a frenzy on Wall Street, with investors searching for companies that develop AI-related technologies. However, as AI becomes more mainstream, experts are considering whether or not it is time to trim some of these stocks.Despite concerns about the AI-driven rally, the future of AI technology remains bright. As more companies capitalize on AI technology, we can expect to see further growth in this field, with many other industries also adopting AI to enhance their operations.