In today’s briefing:
- The Return of Tariff Man
- The AI Bubble Debate
The Return of Tariff Man
- We’ve been warning forweeks that the U.S. equity market advance was extended and it could pull back at any time.
- President Trump’s threat to impose high tariffs on China seems to be the bearish trigger.
- Our base case calls for a 5-10% pullback, and we regard any correction as a welcome pause and opportunity to add to equity positions at lower prices.
The AI Bubble Debate
- Are we in an AI bubble? Probably, but much depends on what stage we are in the bubble.
- On one hand, headline M&A deals like the one concluded with AMD is supportive of further gains.
- On the other hand, the recent Oracle earnings report casts doubt about the profitability of AI cloud computing sustaining elevated valuations.
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