Investing.com — Wedbush forecasts a 25% surge in technology stocks in 2025, driven by the continuing AI boom. The investment bank predicts AI-related capital expenditure (capex) will exceed $2 trillion over the next three years.
According to Wedbush, three key factors will drive the tech industry’s growth. Firstly, the firm anticipates major AI initiatives from the US government, particularly under a potential Trump administration, which would benefit companies such as Microsoft (NASDAQ:MSFT), Amazon (NASDAQ:AMZN), Google (NASDAQ:GOOGL), Palantir (NASDAQ:PLTR), and Oracle (NYSE:ORCL).
The focus on AI is expected to be a central aspect of policy, with significant implications for the defense sector and beyond.
President-elect Trump and SoftBank Group Corp. (TYO:9984) CEO Masayoshi Son announced on Monday that the Japanese investment giant would inject $100 billion into the US over the next four years. The money would aim to create 100,000 jobs focused on AI and related infrastructure.
Wedbush analysts believe the announcement “is just the beginning of more global AI investments in the US which is a bullish backdrop for the broader tech and AI landscape.”
Secondly, the departure of Lina Khan from the Federal Trade Commission (FTC) is seen as a key positive development for the tech industry.
With Andrew Ferguson taking over, Wedbush expects a rollback of Khan’s stringent anti-tech policies, which could lead to an increase in tech mergers and acquisitions (M&A).
“Christmas came early for the tech world as the Khan overhang is removed for the tech world at a key time in the AI arms race in which we expect the strong to get stronger as Mag 7 gets the engines started up again on M&A,” analysts led by Daniel Ives said.
Lastly, Wedbush believes that a Trump victory would be particularly favorable for Tesla (NASDAQ:TSLA) and its CEO, Elon Musk.
The investment firm expects that Trump’s policies would fast-track Tesla’s autonomous and Full Self-Driving (FSD) initiatives, potentially bringing forward the company’s 2026/2027 goals for autonomous vehicles.
“We believe a Trump White House helps unlock the $1 trillion of autonomous/AI value to Tesla’s stock as autonomous/FSD is accelerated starting in 2025 and a key tailwind for Cybercab timing,” Wedbush noted.
