JPMorgan: Profit growth will drive a rebound in semiconductor stocks

JPMorgan strategists stated that AI-related stocks are unlikely to remain under pressure for the long term, expecting that strong earnings growth and improved valuations will reignite demand, especially for semiconductor companies. The team led by Mislav Matejka pointed out that semiconductor stocks have become disconnected from improved earnings prospects, and substantial supply growth will not appear until 2028. It is too early to price in a turning point for semiconductor prices now. Fundamentals remain constructive, and the relative strength index of chip stocks is nearing oversold territory. JPMorgan strategists indicated that if capital expenditure expectations for hyperscale data center operators remain strong, investors should look to re-enter the sector this summer.