JPMorgan Chase: Emerging markets offer investors a lower-cost way to invest in AI

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Deep Tide TechFlow News, May 11, According to JPMorgan Chase’s forecast, major U.S. technology companies will invest up to $700 billion in capital expenditures by 2026, with most of it going toward artificial intelligence infrastructure development. Companies like NVIDIA rely on Asian suppliers for 90% of their hardware. Recent estimates for AI capital expenditure this year and next have been rising, and this trend benefits Asia in the derivative products of that spending.

The capital expenditure of major U.S. tech companies on AI hardware mainly benefits Asian tech firms, while its impact on U.S. GDP is relatively small. JPMorgan Chase emphasizes that profit growth in emerging markets is not only more attractive but also more reasonably valued. The price-to-earnings ratio of this asset class is relatively low in absolute terms and “at its lowest point in history” compared to developed markets. Additionally, investors’ holdings remain relatively low, and capital inflows are accelerating. (Jin10)

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