Goldman Sachs managing director Lee Copsmith says Magnificent Seven shares could be poised for a rebound.
In his latest work ExpectationsCopsmith compares the current market environment to the coronavirus-related drawdown in March 2020.
“During that period, just like today, what it really revealed was that the market lost confidence in Mag 7 stocks as the leaders. And so, I would tell you that I think if you want to, you know, see what happened at that time, obviously post-coronavirus, obviously the comeback of those companies happened. And it was a really great opportunity to put these bullish expressions, particularly in those companies. Whether you did it directly. Or if you did it versus the rest of the market, right?”
And so, what we’re saying today to clients is that if you basically want to look at ways to increase your exposure to the broader market as a whole after a month of essentially de-risking, this represents another really attractive opportunity for clients to use these expressions as a way to get a longer exposure to the market as a whole.
Coopersmith says that investors have not lost confidence in the topic of artificial intelligence and are approaching artificial intelligence through a barbell strategy.
“They want to own the inputs of AI through infrastructure. But they also want to own the outputs of AI, which means transportation companies, the infrastructure that actually then leads to clear productivity spikes.”
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