We expect lower interest rates could support IT projects, economic policy to become less uncertain after the election, and tangible progress with AI products to be presented in upcoming conferences.
There's too much AI pessimism. AI (baskets) are cheap to year-to-date earnings trends, they may require fresh bad news to go down further, which we think is unlikely.
The bank expects net income from AI companies to roughly double in the next 12 months. It also sees more growth in power generation tied to the technology.
The power theme outperformance this year is driven primarily by the earnings growth of this space.
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