AI Broadens Market Gains

Benzinga

Ed Yardeni said Big Tech leadership is fading as AI shifts from creation to adoption, with future market gains likely coming from the broader S&P 500 rather than the Magnificent 7.

Transcript

00:00It's Benzinga bringing Wall Street to Main Street.

00:02Ed Yardini said leadership from the Magnificent Seven tech stocks is fading as artificial

00:07intelligence shifts from creation to adoption across the broader market, according to Benzinga.

00:12Speaking to CNBC, the Yardini research president said generative AI has eroded competitive moats,

00:18increasing rivalry among major tech companies and pressuring profit margins.

00:23He said information technology and communication services already account for nearly 45%

00:28of S&P 500 market capitalization, limiting justification for further sector overweighting.

00:34Yardini said future gains will come from the remaining 493 companies that use AI to improve

00:40existing businesses.

00:41Yardini said he continues to recommend overweighting financials and industrials as both sectors

00:46benefit from a solid economy and increased manufacturing investment.

00:50He forecast the S&P 500 reaching 7,700 next year and rising to 10,000 by the end of the

00:58decade.

00:58For all things money, visit Benzinga.com.

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