The Rise of Big Tech Stocks Will Not Stop

Chris Harvey, Wells Fargo’s chief equity strategist, disagrees with the idea that the current powerful rally of technology stocks will come to an end anytime soon. According to Business Insider, the only way to slow down the, fueled by artificial intelligence, is by raising interest rates. Harvey believes that only the Federal Reserve, its tight monetary policy, can put an end to the Big Tech’s mass growth, which started this year. “Technologies won’t change until the economy is broken – just like it happened in 1999, and is likely to happen now,” he said. The Federal Reserve had raised interest rates from almost zero to more than 5% from March of last year to May of this year in an attempt to control rising prices. However, in early June, it did not take any action, waiting for inflation to drop, which it did.

On the wave of the AI boom, both the S&P 500 index and the high-tech Nasdaq Composite rose, thanks to the rally of AI-related companies such as Nvidia and Microsoft. It’s a sentiment that Harvey shares, as he believes that any correction in Big Tech will be short-lived. Nonetheless, he thinks the future of technology is going to be determined by government regulations and geopolitics, so the impact on the future of AI and big tech may be significant. He is confident that if the economy continues to improve, then the Big Tech rally will continue as well.