Technology stocks are on a tear.
Investors can’t agree on whether their recent run looks like the prelude to an eventual bust—like that of the dot-com era—or the start of a more durable rally.
Hype around artificial intelligence has helped drive shares of technology companies to records this year. The rally has only intensified heading into the end of the quarter.
The Nasdaq Composite is coming off its eighth consecutive weekly gain, its longest streak since a 10-week run through March 2019. Individual investors have been snapping up shares of technology-focused companies, with data from Vanda Research showing the group poured more money into Tesla than any other stock last week. Options bets have exploded. The most popular contracts traded Friday were bullish bets on Tesla, Nvidia, Advanced Micro Devices, Apple and Meta Platforms, according to data from Trade Alert.
Investors and analysts who believe the rally has more room to run say that software developers, chip makers and other companies investing money in artificial intelligence have the potential to be at the forefront of a technology that could transform society in the coming years.
“I don’t view this as 1999,” said Dan Ives, senior equity research analyst at Wedbush Securities, referring to the run-up in dot-com companies that preceded a painful market selloff the following year.
Others are more skeptical. They say previous boom-and-bust cycles have taught them that it is more difficult than it might seem to pick out the handful of companies that could ultimately dominate a given industry over the long run.
www.wsj.com/articles/tech-stock-boom-pits-ai-against-the-fed-6ac93965?mod=djemalertNEWS
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