The Nasdaq will rise to 30,000 points in the next year as a bumper earnings season continues to bolster enthusiasm for AI stocks, Dan Ives, managing director at Wedbush Securities, told CNBC’s Squawk Box Europe on Monday.
A solid tech earnings season has seen investor jitters earlier this year replaced with bullishness over the AI infrastructure buildout. At close on Friday the Nasdaq Composite ended at 26,247.08, marking a 12.93% increase so far this year.
“These earnings have validated the AI bullish thesis,” Ives said. “Demand and supply is 10-1 for chips. We are in the early days still of the AI revolution. The haters will hate, and we know that.”
Michael Burry of “Big Short” fame on Friday warned that the stock market’s fixation on AI is beginning to resemble the final stages of the dot-com bubble.
“Stocks are not up or down because of jobs or consumer sentiment,” Burry wrote. “They are going straight up because they have been going straight up. On a two letter thesis that everyone thinks they understand. … Feeling like the last months of the 1999-2000 bubble.”
But Ives is backing the AI rally to continue for another two years.
“It’s a memory super-cycle,” he said, referring to the unprecedented demand for memory chips sparked by a rapid AI infrastructure buildout. “When it comes to SK Hynix [and other memory companies] we’re very bullish in what we’re seeing there.”
“It’s about playing the hyperscalers — of course chips, then you have to play software, cybersecurity, infrastructure [and] power. You can’t just own one subsector, you have to own the derivative plays,” Ives said.
Nasdaq composite.
Over the past month, Nasdaq’s PHLX Semiconductor Sector Index — comprising the 30 largest U.S.-traded chip companies — has soared 38%. Intel, Nvidia, Apple and Alphabet have all enjoyed double-digit growth.
Paul Tudor Jones, founder and chief investment officer of Tudor Investment, also told CNBC’s “Squawk Box” on Thursday that the AI-fueled bull market still has further to run, but added there could be some “breathtaking” valuation corrections in time.
