Wall Street Rises, Overcoming AI Concerns

Wall Street Rises, Overcoming AI Concerns:
U.S. stock indices increased as gains in most major sectors outweighed disappointing earnings from some tech giants.
However, Treasury yields fell to their lowest levels since 2025 following weak data from the U.S. services sector.

 

Contents

Mixed Performance of Tech Stocks

Wall Street Challenges

The Rise of DeepSeek

Market and Index Performance

Market Volatility

Unforeseen Risks

Jobs Report Expectations

 

 

 

Mixed Performance of Tech Stocks Amid Market Volatility

Shares of approximately 350 companies in the S&P 500 index rose,
with Nvidia leading gains in the semiconductor sector.
However, the “Magnificent Seven” index (Alphabet, Apple, Amazon, Nvidia, Meta, Microsoft, Tesla)
declined by 1.5% after Alphabet’s stock recorded
It’s the worst drop in over a year due to disappointing financial results.
Advanced Micro Devices (AMD) shares also fell by 6.3% due to weak forecasts.

Qualcomm shares rose on optimistic sales forecasts in extended trading after market close,
while Arm Holdings issued weak projections.
Ford Motor also warned of a potential decline in profits.

 

Wall Street Challenges and Market Volatility

Economic markets have been impacted by fluctuating data, trade tensions,
and questions about whether massive AI investments will start generating returns.
According to
Mark Hackett of Nationwide,
recent market events serve as a stark reminder to investors that volatility can arise unexpectedly.

 

The Emergence of “DeepSeek” and Its Market Impact

Last week, Nvidia lost half a trillion dollars in value after the emergence of the AI competitor DeepSeek.
Additionally,
Alphabet’s earnings raised concerns about capital expenditures,
affecting major tech stocks and driving the bull market.

While the “Magnificent Seven” contributed to more than
half of the
S&P 500’s gains over the past two years, their earnings growth has slowed.

According to Ed Yardeni, founder of Yardeni Research,
Other S&P 500 companies now have a greater chance of growth and benefit from productivity-enhancing technologies.

 

Market and Index Performance:

The S&P 500 index rose by 0.4%, the Nasdaq 100 added 0.4% in gains,
and the
Dow Jones Industrial Average increased by 0.7%.

Meanwhile, UnitedHealth Group trimmed its losses to 1% after announcing its communication
with the
U.S. Securities and Exchange Commission (SEC)
regarding concerns over a deleted post by
Bill Ackman on the “X” platform,
which claimed the company had exaggerated its earnings report.

On the other hand, Uber shares dropped 7.6% due to weak guidance on booked revenues.

The 10-year U.S. Treasury yield fell by 9 basis points,
reaching
4.42%, while the Bloomberg Dollar Spot Index declined by 0.2%.

 

 

 

 

Market Volatility and Future Investments

According to Daniel Skelly from Morgan Stanley,
markets are struggling to stabilize amid shifts in the economic landscape,
including anticipated tariffs and mixed corporate earnings.

With ongoing uncertainty, global sectors such as information technology, equipment,
and automotive industries may be more vulnerable,
while
domestic sectors, such as financial services, could attract more investor interest.

 

Unforeseen Risks and Their Market Impact

According to Jim Chanos, one of the most renowned shortsellers,
real market risks remain unpredictable until they occur.
He pointed to the
DeepSeek impact, which unexpectedly erased nearly $1 trillion in market value.

As earnings season approaches,
analysts closely watch companies that achieve a
“Triple Play.”
beating revenue and earnings expectations while improving future guidance.

This year:

75% of companies exceeded earnings per share (EPS) expectations

66% surpassed revenue estimates

8% lowered future guidance

 

Jobs Report Expectations and Market Reaction

Traders are eagerly anticipating Friday’s jobs report.
Data has shown
strong job growth, reinforcing labor market resilience amid economic uncertainties.

The Federal Reserve closely monitors labor market trends to determine the extent of interest rate cuts this year.
Last year’s
rising unemployment rate was key
to the
Fed’s decision to cut interest rates by a percentage point in 2024.
However,
Fed Chair Jerome Powell recently described the labor market as “very stable.”

A survey by 22V Research found that:

24% of participants believe Friday’s report will be “a risk indicator.”

30% see it as a “low-risk indicator.”

46% think it will have “little to no impact”

According to Dennis DeBusschere of 22V Research,
investors are now focusing on
average hourly earnings,
shifting away from
payroll numbers and unemployment rates were last month’s key concerns.

 

Wall Street Rises, Overcoming AI Concerns

Indonesia Nears Agreement with Apple to Lift iPhone 16 Sales Ban

Indonesia Nears Agreement with Apple to Lift iPhone 16 Sales Ban:
Indonesian Minister of Investment Rosan Roeslani announced that the country
is close to reaching an agreement with Apple regarding an investment
plan to lift the ban on iPhone 16 sales in the Indonesian market.

 

Content

Indonesia nears an agreement with Apple

Trump announces a historic initiative

Cryptocurrency regulations

 

 

 

 

Indonesia Nears Agreement with Apple to Lift iPhone 16 Sales Ban

Indonesian Minister of Investment Rosan Roeslani announced that the country
is close to reaching an agreement with Apple regarding an investment
plan to lift the ban on iPhone 16 sales in the Indonesian market.

Roeslani expressed hope in a Bloomberg TV interview on Tuesday
that the crisis would be resolved within a week or two,
highlighting progress in negotiations with the American company.

Indonesia banned iPhone 16 sales last year due to Apple’s failure to comply with local regulations
requiring devices to have at least 40% local components.
Despite Indonesia’s massive population of 280 million,
Apple has yet to establish local factories, prompting the government to impose these restrictions to boost domestic production.

 

Trump Announces Historic $500 Billion AI Investment Initiative

On his first working day after returning to the White House,
U.S. President Donald Trump unveiled a massive initiative to strengthen the country’s artificial intelligence (AI) position.

At a press conference attended by leading tech executives,
Trump announced plans to establish a new U.S.-based company, ”
Stargate,” which will invest at least $500 billion to develop AI infrastructure.

Trump described the project as “the largest in AI history,”
emphasizing that this initiative would place the U.S. at the forefront of technological innovation.

Notable attendees included Larry Ellison, Chairman of Oracle, Masayoshi Son,
CEO of SoftBank, and Sam Altman, CEO of OpenAI, praised the initiative as “the most significant project of this era,”
expressing gratitude to Trump for this achievement.

This initiative is part of a larger strategy to reinforce U.S. leadership
in future technologies and foster public-private sector collaboration.

 

 

 

 

Trump Administration Takes Steps to Regulate Cryptocurrencies by Announcing New Task Force

Just one day after his inauguration, President Donald Trump’s administration launched Its
first initiative is to support the cryptocurrency industry
by removing regulatory barriers in a move widely anticipated by the market.

On Tuesday, the U.S. Securities and Exchange Commission (SEC) announced it created a task force led by Acting Chairman Marc Uyeda
to develop a comprehensive regulatory framework for crypto assets.

Commissioner Hester Peirce will lead the team,
focusing on creating clear rules and addressing issues related to cryptocurrency registration.

Commenting on the initiative, Peirce stated,
“We are excited to work with the public to promote a regulatory environment that ensures investor protection,
supports capital formation, enhances market integrity, and encourages innovation.”

This initiative is part of the Trump administration’s efforts to reshape laws
and regulations to keep pace with developments
in the digital asset industry and strengthen the U.S.’s global position in this field.

 

Indonesia Nears Agreement with Apple to Lift iPhone 16 Sales Ban

Microsoft Announces $3 Billion AI Investment in India

Microsoft Announces $3 Billion AI Investment in India: On Tuesday,
Microsoft CEO Satya Nadella announced that the company plans to invest $3 billion
in India over the next two years to enhance cloud infrastructure, artificial intelligence (AI), and training.

 

Content

Microsoft

Factory Orders in Germany

Producer Prices in the Eurozone

 

 

 

 

Microsoft Announces $3 Billion AI Investment in India

On Tuesday, Microsoft CEO Satya Nadella revealed the company’s plan
to invest $3 billion in India over the next two years to strengthen cloud infrastructure, artificial intelligence, and training programs.
This investment comes amid increasing competition in the AI market in India,
which has become a key destination for major tech companies due to its vast population and promising tech talent.

Nadella highlighted that the investment will include establishing new data centers,
emphasizing that India is quickly emerging as a leader in AI innovation, opening new avenues for development across the country.

This announcement follows less than a week after Microsoft President Brad Smith
stated that the company plans to invest $80 billion globally in AI this year,
focusing on building data centers and advancing technological infrastructure.

The AI sector in India has garnered significant attention from global companies.
Senior officials from Nividia and Meta recently visited the country, underscoring India’s growing stature as a hub for technological development.

 

Factory Orders in Germany Record Biggest Contraction in 3 Months

Data from Germany’s Federal Statistical Office (Destatis) on Wednesday showed a continued contraction in factory orders,
with a 5.4% decline in November compared to October.
This marks the largest monthly drop in three months and is significantly
worse than market expectations of a slight 0.3% decline after a 1.5% contraction in October.

Factory orders fell by 1.7% in November compared to last year’s month, following a 5.7% growth in October.
This reflects ongoing pressures on the industrial sector in the Eurozone’s largest economy.

 

 

 

 

Eurozone Producer Prices Record Annual Decline and Monthly Increase Due to Energy Prices

Data released by Eurostat on Wednesday indicated that producer prices
in the Eurozone’s industrial sector recorded a 1.2% annual decline in November, compared to a 3.3% drop in October.

Every month, producer prices rose by 1.6% in November after a 0.4% increase in October,
primarily driven by a 5.4% surge in energy prices. In contrast, durable consumer goods prices fell by 0.2%,
while non-durable goods prices remained unchanged.

The data also showed that energy prices in the Eurozone dropped by 5.3% year-over-year,
while intermediate goods prices fell by 0.3%, offsetting the impact of rising prices in other categories.

On a country level, Slovakia recorded the most significant annual drop in industrial producer prices at 18.7%,
followed by Luxembourg at 6.6% and France at 5.2%.

These figures highlight ongoing economic pressures in the Eurozone,
with significant energy price volatility affecting overall pricing trends in the industrial sector.

Microsoft Announces $3 Billion AI Investment in India

 

AI Chatbots Threaten Google’s Search Engine Dominance

AI Chatbots Threaten Google’s Search Engine Dominance: Matthew Berman was planning a camping trip
when he remembered a tip suggesting that pitching a tent on top of a car rather than on the ground
could protect against animal attacks.
In the past, he would have turned to Google’s search engine to verify such information,
but now he relies on a chatbot called
Perplexity.”

Perplexity, which markets itself as an “AI-powered answer engine,”
provides concise and direct answers instead of a list of links (though it does include links to sources).
Berman, the founder of a startup called “Sonar,” which helps businesses manage text messages, commented: “It’s simply about saving time.”

 

Content

Moving Away

Tech Giants Respond

Shifts in the Online Search Model

Challenges with AI

The Road Ahead

 

 

 

 

 

Moving Away from Traditional Search Engines

Berman estimates that AI-powered search tools have reduced his use of Google by over 90%.
He explained: “Searching on Google can waste a lot of time navigating links,
and it’s frustrating not to find what you’re looking for immediately.
On the other hand, with tools like (Perplexity) or (ChatGPT),
you’re much more likely to get the answer you need on the first try.”

Returning to his camping trip, Berman found that pitching a tent on top of the car wasn’t worthwhile,
even though it might provide extra protection against predators.

While the number of users of AI-powered chatbots is still relatively limited compared to traditional search engines,
these early adopters are paving the way for broader acceptance of new technologies.
They also influence how companies design their products.

 

Tech Giants Respond

Major search engine companies like Alphabet (Google’s parent company) and Microsoft
have recognized the importance of integrating AI into their products.
Google, for instance, has introduced a feature called “AI Overviews” to generate direct answers within its search results.
In October, Google CEO Sundar Pichai revealed that this feature
now serves a billion users monthly, with plans to expand to over 100 countries.

 

 

 

Shifts in the Online Search Model

Searching for information on Google has long been one of the most common activities online,
and many companies have built their business models around this behavior.
However, users are now starting to pay for AI-powered search services.

For example, Perplexity Pro and ChatGPT Plus offer advanced search features for a $20 monthly subscription.
The big question remains: How will Google adapt to this new reality?

 

Challenges with AI: “Hallucinated Answers”

AI chatbots rely on artificial intelligence to provide answers, but they can sometimes offer inaccurate information,
a phenomenon known as “AI hallucination.”
For instance, when ChatGPT was asked for hiking trails in Palo Alto,
it generated a map with clear errors, which could have caused a problem if the user hadn’t noticed beforehand.

John Bailey, a fellow at the American Enterprise Institute,
advises treating AI-generated results cautiously and reviewing them thoroughly before relying on them.
While Google can also deliver inaccurate information,
users are generally more experienced in assessing website credibility than AI chatbots.

 

The Road Ahead

While chatbots like Perplexity and ChatGPT are improving their accuracy,
they still face challenges regarding reliability and cost.
Early adopters may tolerate these flaws, but most internet users may still prefer traditional search engines.

Ultimately, the key question remains: can chatbots redefine online search habits, or will Google maintain its dominance?

 

AI Chatbots Threaten Google’s Search Engine Dominance

SoftBank’s OpenAI Investment and Goldman Sachs’ Oil Forecasts

SoftBank’s OpenAI Investment and Goldman Sachs’ Oil Forecasts:
Recent developments in rapid economic and technological transformations
 have highlighted significant trends in artificial intelligence and energy markets.
SoftBank Group announced its acquisition of $1.5 billion shares in OpenAI,
strengthening its position in the AI sector.
Meanwhile, Goldman Sachs has predicted that
Brent crude oil prices could reach $78 per barrel by mid-next year,
driven by multiple factors impacting the global oil market.
This article delves into the details of these two topics and their implications for the worldwide economy.

 

Contents

SoftBank

Goldman Sachs

 

 

 

SoftBank Acquires $1.5 Billion in OpenAI Shares.

OpenAI has allowed its employees to sell $1.5 billion worth of shares to Japan’s SoftBank Group,
which aims to enhance its stake in the company behind the AI-powered chatbot ChatGPT.

According to sources cited by CNBC,
the deal has garnered strong support from OpenAI’s CEO, Sam Altman, and SoftBank’s CEO, Masayoshi Son.

This comes after SoftBank’s $500 million investment in OpenAI’s
most recent funding round, which valued the company at $157 billion.

Employees have until December 24 to decide whether to participate in this round,
with an offer of $210 per share, aligning with the company’s latest valuation.

Sources revealed that this funding is not tied to OpenAI’s plans to transition into a profit-driven company,
particularly as it has sufficient liquidity following Microsoft’s $13 billion
backing and the closing of a $6.6 billion funding round in October.

 

 

 

Goldman Sachs: Brent Crude May Reach $78 by June

Dan Struyven, co-head of commodities research at Goldman Sachs,
predicts Brent crude oil will peak at $78 per barrel by June before dropping to $71 in 2026.

Struyven explained that current oil prices are undervalued by approximately $5
due to a market deficit of 500,000 barrels per day last year,
increased demand from the U.S. and China, and ongoing production cuts by OPEC+.

He added that risks related to Iranian supplies and stricter U.S. sanctions could push prices higher in the short term.

Martin Rats of Morgan Stanley echoed this sentiment,
noting that low inventory levels support forecasts for rising oil prices.

 

SoftBank’s OpenAI Investment and Goldman Sachs’ Oil Forecasts

AI Slowdown: A Chance for Reassessment or a Sign of Challenges

AI Slowdown: A Chance for Reassessment or a Sign of Challenges: The AI boom, valued at trillions of dollars,
fostered a widespread belief that generative models would continue advancing rapidly.
However, the current reality suggests otherwise.

 

Contents

Steady Scaling  Assumes 

Concerns About Sustaining Expansion

Who Are the Beneficiaries

The Plateau Curve

Enhancing Models with New Standards

An Opportunity for Regulation and Productivity

Conclusion

 

 

 

Steady Scaling  Assumes 

The “steady scaling” principle assumes that providing AI models
More data and computational power will consistently enhance performance.
Yet, recent reports indicate that this assumption no longer holds,
as major companies are finding it increasingly difficult
to achieve significant improvements in their models compared to the past.

According to a Bloomberg News report,
OpenAI’s “Orion” model showed no substantial progress over its predecessor,
GPT-4. Similarly, Google’s “Gemini” exhibited only slight advancements,
while Anthropic faced delays in releasing its anticipated model, “Claude.”

 

Concerns About Sustaining Expansion

Despite assurances from top executives at companies like OpenAI and Google
that progress has not plateaued,
signs of a slowdown are becoming apparent.
Experts, including OpenAI’s Ilya Sutskever,
have cautioned that the “massive scaling” era may have peaked.
Sutskever described the current phase as “an age of questioning and discovery”
implying a lack of clear direction for the next steps.

This situation raises concerns among investors who have allocated over a trillion
n dollars to develop infrastructure to fulfill AI ambitions.
An investigation by Bloomberg News revealed that central banks
and investment firms have spent billions on large data centers, further intensifying pressure for returns.

 

Who Are the Beneficiaries?

The world’s largest tech companies are undoubtedly the primary beneficiaries of the AI boom.
Cloud storage revenues for companies like Microsoft, Google, and Amazon have consistently grown.
At the same time, the market value of companies such
as Nvidia, Apple, and Meta Platforms has collectively surged by over $8 trillion in the past two years.

However, the actual returns on investment for end-users
and customers remain unclear, raising questions about the broader benefits of this boom.

 

 

 

The Plateau Curve: Slowdown as a Natural Phenomenon

AI has followed the well-known “S-curve” trajectory,
where technological progress undergoes a phase of rapid growth
before slowing down to allow for sustainable development.
This slowdown, rather than being a hindrance,
might present an opportunity to reassess current strategies and focus on innovation.

For instance, it took decades for the aviation
industry to achieve a significant leap with the transition to jet engines.
Yet, progress continued through improvements in efficiency and safety.
AI may undergo a similar transformation,
where future efforts prioritize critical aspects like safety and ethics rather than simply enhancing capabilities.

 

Enhancing Models with New Standards

Instead of relying solely on massive datasets,
researchers are exploring ways to improve model performance post-training.
This includes optimizing inference by allowing models additional time to analyze responses.
OpenAI has described its new model as better at “logical reasoning,” reflecting this approach.

 

An Opportunity for Regulation and Productivity

Eric Brynjolfsson, an economist at Stanford University,
believes new technologies often experience a period
of productivity stagnation before achieving significant breakthroughs.
This slowdown could allow companies to refine their processes and adopt technology more effectively.

Moreover, this pause allows regulators sufficient time to establish robust legislation,
such as the European AI Act, expected to take effect in 2026.

 

Conclusion

Generative AI has experienced a slowdown following a period of rapid growth,
prompting companies to reassess their strategies.
While progress has decelerated, this presents a chance to enhance regulation,
improve productivity, and explore new paths for innovation.
The slowdown does not signify a halt but a necessary pause before the next leap forward.

 

AI Slowdown: A Chance for Reassessment or a Sign of Challenges

Nvidia’s Revenue Forecast Disappoints Investors and Impacts Tech Markets

Nvidia’s Revenue Forecast Disappoints Investors and Impacts Tech MarketsNvidia, the leading AI chip manufacturer,
announced its revenue forecast for the third quarter of this year, which is estimated at $32.5 billion.
Although this figure exceeded analysts’ average estimates, it fell short of some more optimistic projections that reached $37.9 billion.
This news raised concerns about the company’s rapid growth, leading to a decline in tech stocks in global markets.

 

Content
Nvidia’s Forecast

Artificial Intelligence

AI Spending

Decline in Tech Stocks

Global Stock Markets

Asian Markets

Investment in Technology

 

 

 

Nvidia’s Revenue Forecast and Its Impact on the Market

Nvidia announced that its third-quarter revenue would reach $32.5 billion,
exceeding the average analyst expectation of $31.9 billion but falling short of some more optimistic forecasts of $37.9 billion.
Despite surpassing second-quarter sales expectations,
these numbers raised investor concerns that the company’s rapid growth might face a slowdown in the future.

 

Impact on the AI Boom and Market Value

Nvidia is one of the primary beneficiaries of the race to develop data centers and enhance AI applications,
which has contributed to its rise as the second-largest company in the world in terms of market value.
However, the company’s stock dropped after the revenue forecast announcement,
reflecting investor disappointment from those who had expected better performance,
especially given the stock’s value has been more than doubled since the beginning of the year.

 

AI Spending and Nvidia’s Dependence on Major Clients

The revenue forecast came after several quarters in which Nvidia’s results exceeded Wall Street expectations.
Still, much of this growth relied on a limited number of major clients, such as Google and Meta.
With these companies pouring billions into AI infrastructure,
concerns remain that the scale of these investments could surpass current needs, potentially leading to an economic bubble.

 

Decline in Tech Stocks After the Results Announcement

Major tech stocks declined in late trading after the market closed,
with investors disappointed by Nvidia’s results.
The Nasdaq 100 index fell by 0.5%, while Nvidia’s stock dropped by 3%.
This was influenced by revenue forecasts that fell short of some investors’ hopes for continued earnings growth.

 

 

 

 

 

Impact of the Forecast on Global Stock Markets

Nvidia’s forecast triggered a fresh wave of market volatility,
the S&P 500 index declined by 0.6%, and the Nasdaq 100 fell by 1.2%.
The volatility index (VIX) also rose to around 17 points,
reflecting the prevailing anxiety among investors about the future of tech stocks,
particularly amid macroeconomic data and semiconductor export controls that could heighten these fluctuations.

 

Impact of Nvidia’s Forecast on Asian Markets

Nvidia’s announcement also impacted Asian markets,
with significant chip manufacturers like Taiwan Semiconductor and SK Hynix seeing declines.
This led to a 0.5% drop in the MSCI Asia-Pacific Index.
These decreases highlight that Nvidia’s performance has a global effect,
influencing investor confidence across the tech sector.

 

The Future of Investment in Technology and Artificial Intelligence  

Despite current challenges and volatility,
optimism remains strong about the future of AI and its role in driving growth and innovation.
Analysts believe that investment in this field will continue to thrive,
with the need to manage risk exposure carefully to ensure gains without falling into the trap of unsustainable inflation. 

 

Nvidia’s Revenue Forecast Disappoints Investors and Impacts Tech Markets

Potential Collaboration between Meta and  Apple in AI

Potential Collaboration between Meta and  Apple in AI: Meta, the parent company of Facebook,
is in talks with Apple to explore the possibilities of integrating their artificial intelligence models,
aiming to enhance the capabilities of Apple’s AI system. 


Content

Collaboration Talks

Expanding Partnerships

Reactions and Developments

Launching Apple Intelligence

Conclusion

 

 

 

 

Collaboration Talks

According to reports from the Wall Street Journal,
Meta has been discussing with Apple the integration of its generative AI model into Apple’s AI system for the iPhone.
Apple, which has developed smaller AI models, seeks to leverage partnerships to perform more complex and precise tasks.

 

Expanding Partnerships

In addition to Meta, companies Anthropic and Perplexity are also discussing integrating their technologies into the Apple Intelligence system with Apple.
This move indicates Apple’s desire to expand its collaboration with AI developers to enhance its technological functions.

 

Reactions and Developments

Apple did not respond to Bloomberg’s requests for comments outside regular business hours,
and Meta refrained from commenting on the talks.
These developments suggest early steps toward cooperation that could reshape the technological capabilities of both giants.

 

 

 

 

Launching Apple Intelligence

In an effort to bolster its presence in artificial intelligence,
Apple launched the Apple Intelligence service on June 10 during the Worldwide Developers Conference.
This new service is designed to enhance text summarization,
create original images, and retrieve the most relevant data for users when needed.

 

Conclusion

As the focus on artificial intelligence increases,
partnerships between major technology companies emerge as a strategic step to stay at the forefront of innovation.
The talks between Meta and Apple could open new horizons for developing technologies that change how we interact with smart devices.

 

Potential Collaboration between Meta and  Apple in AI

AI Brings TSMC’s Market Value Closer to $1 Trillion

 AI Brings TSMC’s Market Value Closer to $1 Trillion: Optimistic voices about Taiwan Semiconductor Manufacturing Company (TSMC)
are growing increasingly louder amid a series
of stock price increases that bring its market value close to the $1 trillion mark.

 

Contents

Performance of Taiwan Semiconductor Manufacturing Company

The Role of AI Technology in TSMC’s Growth

Wall Street Evaluations

 Attractive Risk Reward

 

 

Performance of Taiwan Semiconductor Manufacturing Company

Last week, Taiwan Semiconductor Manufacturing Company (TSMC) surpassed Berkshire Hathaway Inc.
To become the eighth-largest company in the world by market value,
based on the company’s American Depositary Receipts (ADRs).
This year, a 73% increase in ADRs has driven TSMC’s market value to $932 billion, nearing the $1 trillion mark.

 

The Role of AI Technology in TSMC’s Growth

The leading chip manufacturing company has emerged as a major beneficiary of the expanding adoption of artificial intelligence.
Its advanced technology and reasonable valuation make it a favorite among global investors.
Additionally, the company has thrived as the primary supplier of advanced chips to Nvidia,
which recently became the world’s most valuable company.

 

Wall Street Evaluations

Wall Street investment banks raised their price targets for TSMC this week;
increased demand linked to artificial intelligence and potential price hikes in 2025 could boost profits.
JPMorgan Chase increased its revenue estimates from AI for the company to 35% of total sales by 2028,
while Citigroup raised its price target by 12% based on stronger profit expectations.
Goldman Sachs Group noted that chip manufacturing prices for the three and five-nanometer
nodes are increasing by “less than five percentage points” and raised its 12-month price target by 19% to NT$1,160.

 

Attractive Risk Reward

Goldman analysts, including Bruce Lo, wrote in a note on Tuesday:
“We now see a more attractive risk-reward for TSMC amid growing positive sentiment around AI.
With the ongoing spread of AI, we see TSMC as one of the main beneficiaries of this trend.”

 

AI Brings TSMC’s Market Value Closer to $1 Trillion.

Apple Reclaims Its Throne: Stock Surge Propels It Back to Global Leadership

Apple Reclaims Its Throne: Stock Surge Propels It Back to Global Leadership: Apple’s stock value has surged significantly over the past few days,
reclaiming its title as the highest-valued company from Microsoft.
This rise reflects improved investor sentiment regarding Apple’s growth and its position in artificial intelligence.

 

Content

Apple Stock Performance

The AI Race
Recent Performance of Apple Stock

 Apple’s AI Capabilities

 Impact of Recent Positives

 

 

 

Apple Stock Performance

Apple’s stock recorded an 11% increase over three sessions, adding $323.9 billion to its market value.
This surge has been the strongest since August 2020 and has led to the company closing
with a market capitalization of $3.285 trillion, compared to Microsoft’s $3.282 trillion.
This achievement marks the first time since January that Apple has closed with a higher market value than Microsoft,
representing the latest shift among the largest stocks on Wall Street.
Earlier this week, Apple was third behind Nvidia.

 

The AI Race

Rees Williams, Chief Strategist at Wayve Capital Management,
highlighted a strong conviction that both Apple and Microsoft will be winners in artificial intelligence.
He noted that this market could generate substantial profits for the victors,
predicting that Apple and Microsoft will compete significantly soon, with Nvidia also entering.

 

Recent Performance of Apple Stock

Apple’s stock rose by 0.6% on Thursday, continuing its upward trend for the third consecutive session.
On Tuesday, it recorded the largest one-day increase since November 2022.
This 11% rise over three sessions boosted the company’s market value by $323.9 billion,
which is larger than all but a few components of the S&P 500 index. On the other hand, Microsoft’s stock increased by 0.1% on Thursday.

 

 

 

 

Apple’s AI Capabilities

The catalyst for Apple’s stock rise was a presentation at the Worldwide Developers Conference on Monday,
which focused on artificial intelligence.
This presentation raised hopes that customers would pay for the next generation of iPhones,
potentially spurring the long-awaited growth revival.
Apple’s revenue declined by 4.3% in the second fiscal quarter, marking the fifth decline in the past six quarters.

Wamsi Mohan, an analyst at Bank of America, wrote that AI capabilities will likely drive a multi-year upgrade cycle of faster replacements,
more switching, and higher average selling prices.
He suggested that Apple Intelligence could lead to a major upgrade cycle, noting that consensus estimates are very low.

 

Impact of Recent Positives

The AI event followed a positive quarterly report in early May
when Apple also announced a $110 billion share buyback plan,
the largest repurchase program in U.S. history. Despite recent strength,
growth concerns have limited Apple’s gains compared to other major tech companies.
Thursday’s stock rise pushed Apple’s year-to-date gains to 11%, which is less than the Nasdaq 100 index’s 16% gain.
Stocks with greater AI capabilities, including Microsoft, Amazon, Alphabet, and Meta,
have all outperformed Apple this year, while Nvidia’s stock has soared more than 160%.

 

Apple Reclaims Its Throne: Stock Surge Propels It Back to Global Leadership