JPMorgan: Expected earnings growth will drive a rebound in the US chip sector

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Mars Finance news: JPMorgan strategists said AI-related stocks are unlikely to face sustained pressure, and they expect strong earnings growth and valuation improvements to rekindle demand—especially for semiconductor companies. In a report led by Mislav Matejka, the team noted that semiconductor stocks have become detached from improving earnings outlooks. The report said that material supply growth will not show up until 2028, so it is “too early” to have the semiconductor price turning point already priced into the market; fundamentals may still remain constructive, and the relative strength indicators for these chip stocks are quickly approaching “oversold” territory. JPMorgan strategists added that if the expected capex of mega-scale data center operators stays strong, investors should “re-enter the sector in the summer”. (China Finance Network)
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