MORGAN CHASE: THE COLLAPSE OF THE TECHNOLOGY UNIT DOES NOT MEAN THE END OF THE AI INVESTMENT CYCLE

On 6 August, Chase Morgan indicated that the recent dramatic reversal of the Asian Science and Technology Unit and the semiconductor plate did not mean that the artificial intelligence investment cycle was ending. In its report issued on Wednesday, the Bank noted that market concerns about the sustainability of AI capital expenditure had exceeded reality and that there was little evidence that the basics of the AI industry were slowing significantly. According to Chase Morgan, the Asian Science and Technology Unit and the Philadelphia Semiconductor Index have recently been adjusted by 25 to 30 per cent, the third major retreat since the launch of the AI drive-up cycle at the end of 2022. The bank analyst wrote: “Without stock price fluctuations, we do not see any basic indicators suggesting a significant weakness in the next 6 to 12 months”. According to Chase Morgan, the core drivers of the current AI cycle remain. The Bank noted that the front-line AI model continued to improve over several months, while the demand for AI ' s reasoning capacity remained strong, both for proprietary and open-source models. The commercialization of the AI ecosystem is also increasing as proxy AI evolves. The market has recently become increasingly concerned about whether large cloud computing firms can sustain high AI investments, but Chase Morgan believes that super-large cloud service providers will not easily reduce associated expenditures. The Bank projects that “no super-large enterprise will withdraw from AI-calculated investments in 2027”