00:00 Speaker A
Green all over the place, Christine, we just keep grinding higher here. What do you make of it?
00:08 Christine
Yeah, look, investor appetite is there, right? AI enthusiasm has returned. We just talked about Nvidia. Um, I think there were some whispers today about is this, you know, signifying a bubble here? Is this .com 2.0 with Nvidia being at almost record highs here? And if you look at what analysts are saying, and I know we’re going to hear from one, you know, that covers Nvidia here soon, um, no one’s saying that this is overvalued. I think many are actually saying that we’re still undervalued here on Nvidia because we haven’t quite priced in AI and the impact on productivity. We heard from CEO of Salesforce today, Mark Benioff, saying that 30 to 50% of their workload is now done by AI. And we’ve seen a slew of companies cut, you know, positions because of AI, whether it be Salesforce or CrowdStrike, Klarna, so, or, or Duolingo, who’s actually going to be more discreet about hiring because of AI. So I don’t think we’ve, we’ve folded in the full impact. The one concern I have, and maybe it’s not so much a concern, but what I’m watching is competition from Chinese AI companies. There was a great report in Datatrack Research earlier in the week that just showed the valuations are so much more appetizing on some of those Chinese AI names versus, you know, the US ones. And the returns have actually been higher for those names. So that’s one area that I’m watching is, is the competition between us and those Chinese AI names.
03:11 Speaker A
Josh, you know, Julie mentioned it briefly, but I want to get double tap on it. The mag 7 names, Josh, those giants, right? How have they been working?
03:25 Josh
Yeah, yeah, Josh. So I have a visual representation over here on our big board, right, of sort of some of what Julie was talking about. And what I’m looking at here is just performance since the April 8th low. Uh, most of these stocks here are all in the top 20 of the S&P 500. They’re all AI tied. So I looked at sort of an AI basket of stocks, right? You have Oracle, Broadcom, Dell, AMD, NRG, as Julie mentioned, Vistra, which is sort of an AI power play, and Palantir. What’s interesting is all of the mag 7 have underperformed them, right? So Nvidia’s up about 60% at a new high. Really the rest of these companies have come up about 25, 30% maybe from the bottom. Apple hasn’t really gone anywhere. And Christine, I guess the question this sort of brings me to for you is just, is the next AI trade going to continue to be the broadening out of this trade into cloud computing, into energy, into some of the other chip names, or is that, is that sort of where it feels like this trade is headed as we go through kind of the second half of 25?
05:04 Christine
Yeah, I think we, we are already seeing that broadening out. There’s a lot of liquidity in the market, and I think what surprised me the most is how quickly we’ve rebounded from that April low. And it just goes to show the appetite, the enthusiasm amongst, you know, all of tech. So not just within the AI space, but there is liquidity there. There was cash on the sidelines for quite a while. And now, you know, many of those investors bought the dip, and now we’re seeing it rip.
