Resistance Is Futile (to the Big Tech Rally)

Resistance Is Futile (to the Big Tech Rally)

Global stock markets hit the un-pause button and resumed a 2021-esque advance. Even the ailing U.S. bond market showed encouraging momentum, posting its best month of the year, +1.7%.

Uncertainty following the March Fed meeting stalled bullish sentiment as Wall Street reexamined aspirations for several rate cuts this year. Stubborn inflation paired with economic stability revived hawkish Fed guidance and allusions to potential rate hikes.

Big Tech and the AI boom pushed major large-cap indices to all-time highs. With a watchful eye to summer action and looming election drama, FSA redeployed cash raised from the April dip and is monitoring the breakout closely.

AI Zeitgeist

From Main Street to the C-Suite, trends in artificial intelligence are becoming more apparent. A study of Q1 earnings transcripts revealed a record 199 S&P 500 companies mentioned “AI” in their calls to investors, more than double the five-year average (80)!

A chief artificial intelligence officer (CAIO) might become a staple of management structures sooner than we realize. And it’s not looking like some Silicon Valley fad. An executive order issued last October required all federal agencies to designate a CAIO.

Here’s an excerpt from the 2023 Annual Report published in April by JP Morgan Chase:

“…[W]e are completely convinced the consequences will be extraordinary and possibly as transformational as some of the major technological inventions of the past several hundred years: Think the printing press, the steam engine, electricity, computing and the Internet, among others.”

An incredible endorsement from America’s largest bank. AI’s potential to accelerate long-term productivity and power an economic miracle is capturing the collective imagination.

The Magnificent One

Money continues to concentrate within mega-cap growth stocks. Eclipsing all but Microsoft and Apple, NVIDIA has emerged as the third largest company by market capitalization in the S&P 500. [Note: NVIDIA has surpassed Apple as of June 6, 2024.]

Year-to-date, the dominant supplier of AI products and services has already seen its stock price double, +121.4%.  This one stock accounts for nearly one-third of the S&P 500’s total growth so far this year.

Only time will tell how much of the AI boom will bust. Either way, FSA’s active strategies will stick to the plan: Follow the money and have an exit strategy.

We hope you enjoy these last days of spring. Please remember to tell your advisor if you are experiencing any changes in your life that affect your investment objectives and how we manage your money.

Jordan Daugherty, CFA
Investment Analyst


Disclosures are available at

FSA’s current written Disclosure Brochure and Privacy Notice discussing our current advisory services and fees is also available at or by calling 301-949-7300.



About Author

Related posts