AI Stocks: The Silver Lining in an Otherwise Stormy Tech Market

2 months ago 34

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Adria Cimino, The Motley Fool

Sat, Mar 22, 2025, 3:30 PM 5 min read

On apical of this, investors were feeling optimistic astir the wide economy. The Federal Reserve was wrapping up its involvement complaint increases and connected way to commencement lowering rates -- and this happened. The cardinal slope launched complaint cuts this past autumn and indicated that much would follow. Against this backdrop, maturation stocks besides lifted benchmarks arsenic these types of companies thrive successful amended economical environments -- it's easier for them to expand, and their customers mostly person much wealth to walk connected products and services.

All of this helped the Nasdaq beforehand much than 43% successful 2023 and station a 28% summation past year. But successful caller weeks, this sunny marketplace situation has turned stormy. President Donald Trump announced tariffs connected imports, a determination that could measurement connected prices, driving ostentation higher and hurting firm earnings. As a result, the Nasdaq fell into the correction zone, dropping much than 10% from its latest precocious successful December. But here's the bully news: Even though AI stocks are falling close now, they inactive stay a metallic lining successful this stormy market. Here's why.

An capitalist looks astatine thing connected a telephone portion moving astatine home.

So, first, a speedy look astatine immoderate of the losses we've seen successful caller times. Nvidia (NASDAQ: NVDA), the world's apical AI chipmaker, tumbled 15% implicit the past month; AI bundle institution Palantir Technologies sank 17% during that clip period; and AI dependable specializer SoundHound AI mislaid 12%. And the database goes on...

Though these companies and exertion and maturation players successful wide whitethorn look headwinds successful the adjacent word owed to economical uncertainty oregon a imaginable slowdown, it's important to support successful caput that AI prospects implicit the agelong word haven't changed. Analysts foretell a compound yearly maturation complaint of astir 35% for the AI marketplace done 2030 erstwhile they accidental it volition scope much than $1 trillion.

And we person immoderate factual grounds that could happen. Companies from Meta Platforms (NASDAQ: META) to Alphabet (NASDAQ: GOOG) (NASDAQ: GOOGL) person announced accrued spending to enactment their AI programs. Meta said it would walk arsenic overmuch arsenic $65 cardinal this twelvemonth and is readying to physique a information halfway the size of portion of Manhattan. Alphabet said it plans $75 cardinal successful superior expenditures this year, and overmuch of this volition spell toward servers, information centers, and networking.

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