Investing opportunity across the economy with AI wave, says JPMorgan's Stephanie Aliaga

Summary

Stephanie Aliaga of JPMorgan Asset Management discusses the recent equity pullback as a natural digestion after a ferocious semiconductor rally. She emphasizes that the AI opportunity extends beyond hardware into complementary investments like software, which are not yet fully priced. Despite new issuance overhang, structural demand from passive inflows and 401k contributions provides support. She views the jobs report as benign for the Fed.

• Recent market pullback seen as healthy digestion after semiconductor ETF doubled year-to-date.
• AI wave creates investment opportunities beyond hardware, particularly in software and complementary spending.
• Atlanta Fed survey indicates companies expect to increase AI spend per employee by 50%.
• New issuance (SpaceX IPO, Alphabet secondary) is expected to be absorbed due to strong structural demand.
• Jobs report showed labor market strength without triggering wage inflation, reducing Fed pressure.
• Geopolitical risks remain but the path is seen as de-escalatory.
• Investors are rotating out of overbought semiconductor names into other areas.