Wedbush analysts are urging investors to seize the current tech sell-off as a "golden buying opportunity," despite recent market jitters sparked by former President Trump's comments on China tariffs and Taiwan.
The sell-off hit semiconductor, AI revolution stocks, and Big Tech, but Wedbush believes this reaction is overblown.
Reflecting on Trump's comments' impact on tech stocks, Wedbush notes, "When Trump got into the White House in 2016, we went through many days and weeks in which Trump White House comments were viewed as the 'doomsday' for Big Tech."
They note that despite these fears, the tech sector continued to thrive. Similarly, the firm says that during the Biden administration, concerns about China tariffs and Taiwan issues caused temporary market frost but did not derail the long-term growth trajectory.
Wedbush asserts that the latest sell-off, prompted by Trump's remarks at the RNC National Convention, is another instance of the market overreacting to political rhetoric.
They emphasize that "the bark will be way worse than the bite on the US/China Cold Tech War fears," and view the current political climate as "a game of high stakes poker for the Trump campaign."
The analysts maintain a bullish outlook on the tech sector, emphasizing that the "Trump trade" will not derail the AI Revolution or the tech bull market.
They highlight that semiconductors and tech production will not dramatically shift to the US despite political narratives. Instead, they foresee gradual domestic ramp-ups supported by tax incentives and legislation like the Inflation Reduction Act.
Wedbush is optimistic about the upcoming 2Q earnings, predicting a positive catalyst for tech stocks, which they expect to rise another 15% by year-end. They identify standout companies, including Microsoft (NASDAQ:MSFT), Alphabet (NASDAQ:GOOGL), Amazon (NASDAQ:AMZN), Palantir (NYSE:PLTR), Meta (NASDAQ:META), and leading cybersecurity firms like Zscaler (NASDAQ:ZS), CrowdStrike (NASDAQ:CRWD), Palo Alto, CyberArk, Check Point, and Tenable.