Source: Zhitong Finance "Since 1950, the S&P 500 index has risen more than 10% 21 times as of the end of May. In about 90% of these cases, the S&P 500 index rose for the rest of the year. There were only two instances of declines for the rest of the year, in 1987 (-13%) and 1986 (-0.1%)." With the rebound of the stock market, the old adage "Sell in May and Go Away" seems to have been a bad advice once again. Last month, the S&P 500 index rose 4.8%, the best May performance since 2009. The NASDAQ 100 index rose nearly 6.2%, and the NASDAQ Composite Index rose 6.9%. Goldman Sachs FICC & Equities Trading Division said: "History doesn't really support this saying. Don't sell, leave the market (go on vacation), and enjoy the good times." The rising trend is still to be continued? If history is any guide, it may indicate that the rise of the stock market is not over yet. Looking ahead to the rest of 2024, Scott Rubner, Managing Director of the Goldman Sachs Global Markets Division and tactical expert, pointed out the following historical background for investors. Rubner stated that the S&P 500 index has risen 10.7% year-to-date, and since 1950, the S&P 500 index has risen more than 10% 21 times as of the end of May. In about 90% of these cases, the S&P 500 index rose for the rest of the year. There were only two instances of declines for the rest of the year, in 1987 (-13%) and 1986 (-0.1%). "Since 1950, the median return of the last 7 months of each year (June 1 to December 31) is 5.4%. In the aforementioned 21 cases, the average performance of the last 7 months increased to 8.1%." Rubner added. Rubner also pointed out that the NASDAQ index has risen for 16 consecutive Julys, with an average return of about 4.64%.
UBS Group believes that enthusiasm for artificial intelligence may need to be cooled down, even if it's just a little bit.
According to the Zhongtong Finance APP, since the launch of ChatGPT at the end of 2022, generative artificial intelligence has had a widespread impact on the global economy and society. Although some research companies believe that generative artificial intelligence may disrupt all industries, UBS Group believes that enthusiasm for artificial intelligence may need to be cooled down, even if it's just a little bit.
UBS Group stated in an investor report: "We are witnessing the beginning of a major investment boom and technological advancement that could fundamentally affect all economic sectors. However, additional use cases need to be developed to prove the rationale for these investments."
UBS Group stated that estimates of how much investment artificial intelligence will drive vary, but most people believe that it will bring trillions of dollars in additional investment in the next decade. Therefore, the impact on companies, employees, and investors is huge.
UBS Group stated: "Although it is too early to accurately quantify the overall productivity gains from artificial intelligence, there is evidence that efficiency has improved dramatically." "For example, using GitHub Copilot, developers have increased their code writing speed by 55%. Boston Consulting Group estimates that when generative artificial intelligence is implemented on a large scale, the efficiency of customer service operations will increase by 30-50%."
Companies that may benefit from increased spending in artificial intelligence at the three levels (empowerment, intelligence, and application) include$Alphabet-A (GOOGL.US)$, $Microsoft (MSFT.US)$, $Amazon (AMZN.US)$, $Meta Platforms (META.US)$, $NVIDIA (NVDA.US)$, $TENCENT (00700.HK)$, $Baidu (BIDU.US)$/$BIDU-SW (09888.HK)$, $Alibaba (BABA.US)$/$BABA-SW (09988.HK)$and Huawei.
In addition, UBS analysts have made a series of predictions about how artificial intelligence will reshape the global economy and its wider impact:
1. Artificial intelligence will be one of the most profound innovations and largest investment opportunities in human history;
2. Artificial intelligence will initiate a data center capital expenditure cycle, which will make the capital expenditure of general data centers pale in comparison in the coming years;
3. The ratio of monetization of the application layer of artificial intelligence to the cost of the supporting layer and the intelligent layer will become a key indicator of investment returns;
4. The competition in the field of general artificial intelligence (AGI) may trigger a capital expenditure cycle, leading to the inflation of investment bubbles and the separation of capital expenditure potential for the enabling layer and short-term monetization potential for the application layer;
5. Advocates of artificial intelligence will become the first adopters of artificial intelligence, thereby driving up revenue and profit margins;
6. A single participant will appear on the artificial intelligence value chain, and over time, the artificial intelligence market will be monopolized by vertically integrated "artificial intelligence factories";
7. Artificial intelligence chips will account for a significant portion of artificial intelligence value creation;
8. The application and intelligence layers will merge with general artificial intelligence (AGI);
9. Software will become ubiquitous;
10. Data assets will become a competitive advantage for information technology adopters of artificial intelligence.
Editor / jayden