This is a huge technological breakthrough that will mean major changes in society, but it can also be very volatile along the way. There have been some incredibly good months earlier this year, and now it has been a bit sour for a while, says SEB's equity strategist Esbjörn Lundevall.
Last night, several technology companies fell on Wall Street. During the morning, giants like Samsung and SK Hynix plummeted on the South Korean stock exchange, and this morning, Dutch semiconductor giant ASML continues to come under pressure on the Amsterdam Stock Exchange.
The market is volatile because the financial investments are enormous, says Lundevall, pointing out that the American giants that manufacture data centers will invest $850 billion in the coming year.
That's more than Sweden's GDP, for example. This amount of money has increased fivefold in three years.
In the past 24 hours, new information about so-called circular flows and Chinese competition has shaken the market.
Circular flows create concern
Yesterday we had a clear catalyst in the form of discussions about Nvidia providing guarantees of $250 billion to a customer.
The Wall Street Journal reported, citing sources, that Nvidia is considering providing financial guarantees to its customer OpenAI.
This possible need for a circular flow of money is in itself a cause for concern. The market thinks that if the investments are so good, they should be able to get market-based financing from someone other than their subcontractor, says Lundevall.
Chinese competition is frightening
In addition, Chinese alternatives have begun to threaten the larger players. Dutch ASML, Europe's most valuable listed company, has essentially had a monopoly on so-called lithography machines for chip production.
Now suddenly a Chinese player has started mass-producing the machines, at a fairly advanced level too, says Lundevall.
There are players who have manufactured simpler models, but yesterday The Information reported that a Chinese player has begun mass-producing advanced machines.
What was really scary here was that this was a really advanced machine that the Chinese could manufacture.
The question is how Swedish small savers should navigate when searching among different funds and stocks.
You have to have a fairly high risk tolerance if you want to invest in this area. But at the same time, it is in such areas that you can make a lot of money, he says.
