Analysts cite long-term benefits of AI adoption despite a 7% average decline in related stocks in July.
AI infrastructure stocks, including Micron Technology and Intel, fell nearly 7% in July as investors questioned returns on massive AI spending by firms like Meta and Alphabet. The pullback has extended across memory chips, copper, silver, and construction sectors.
Morgan Stanley analysts described AI infrastructure as an emerging “intelligence superhighway” with global economic benefits. Despite near-term risks like cost concerns and Chinese competition, they expect continued improvement in AI capabilities and capital expenditures.
The bank’s July 28 note called the current dip an “unusually attractive buying opportunity,” recommending investors capitalize on the decline.