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Investing.com -- As concerns over high AI valuations lead to a slump in US tech stocks, strategists from Societe Generale (OTC:SCGLY) are advising investors to buy the S&P 500 equal-weighted index. This strategy would lessen the influence of the technology giants on the index.
Tech stocks fell sharply today after China's AI startup DeepSeek said its R1 and V3 models performed better than or close to leading Western models.
The team led by Manish Kabra suggests harnessing the ongoing market volatility by investing in fresh secular themes that emphasize long-term 'America-First' strategies.
In a note, Kabra and his team highlighted that the responsibility might be on the hyperscalers to validate their capital expenditure projections. However, they also noted that if more companies devise productive methods of utilizing AI, these hyperscalers stand to gain as well.
The recommendation comes at a time when the high valuations of AI in the tech sector are causing apprehension among investors.
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