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AI Stocks on the Rebound
In the first half of 2023, many AI stocks faced challenges as investors pulled away from growth-oriented companies due to concerns over President Trump’s tariff plans. Major indexes like the S&P 500, Dow Jones Industrial Average, and Nasdaq Composite saw declines in April, but recent improvements in investor sentiment have emerged, particularly following initial trade deals with the U.K. and China.
Stock Performances
Amazon (NASDAQ: AMZN) ended the first half at a standstill with a 0% change amid concerns about tariffs affecting e-commerce demand. However, its wide product selection and robust cloud services position it well for future growth. Alphabet (NASDAQ: GOOG, GOOGL) experienced a 6% decline but rebounded over 20% from its lowest point in April, aided by AI advancements and a reported 28% increase in Google Cloud revenue to over $12 billion.
Market Outlook
As the market outlook improves, both Amazon and Alphabet are expected to benefit from the ongoing AI boom. Amazon trades at a valuation of 35 times forward earnings while Alphabet is at 18 times, making them attractive options for investors looking for gains in the second half of 2023.
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