The stock markets have been volatile, both in the US and in Stockholm, over the past week.
Since last spring, the enormous AI investments have dominated overall, with strong price increases, especially in the technology sector.
"It's a pretty narrow market rally. And now this question of an AI bubble has come to the table," says Jon Arnell, chief investment officer at Von Euler & Partners.
Lifted on stones
The valuations of the primarily American technology giants, which build data centers for the good life, have skyrocketed.
There are now concerns that these are huge investments but that cash flows may not really live up to those investments going forward.
A number of other equity analysts also reason in a similar way.
What remains to be seen, now that there are such incredible sums of thousands of billions of dollars being ploughed into this, is whether there is still a willingness to pay for these AI services, says Esbjörn Lundevall, equity strategist at SEB.
Furthermore, if it doesn't become cheaper to borrow for the large data complexes that are planned, the calculations won't be any easier to calculate.
Everything is connected, the market likes cheap money, says Jon Arnell.
Bitcoin is crashing
The fact that risk appetite has declined is also reflected in the recent collapse of the bitcoin price, after having surged to new heights in step with the stock markets.
Rather, it serves as an indicator of how risk-averse investors are, he says.
But despite that, not much new has really happened. Arnell therefore believes that the fluctuations are calming down and that the stock exchanges, perhaps especially the one in Stockholm, have the potential to rise again.
It's usually a strong end to the year. And given that the American economy doesn't completely collapse, it's still a stable economy, says the investment manager, who at the same time cautions that the American labor market is showing some signs of weakness.
“Sweden looks better”
Instead, he highlights the Swedish economy and the Stockholm Stock Exchange.
Especially small companies, which have performed worse this year and are more dependent on the domestic economy.
What does this boil down to, how should I think as a small saver?
Our view is that Sweden looks better, that it is better to position yourself in Swedish stocks than in global ones, says Arnell and concludes with an advisor's classic:
Sit still in the boat and spread your risks.
Olle Lindström/TT
Facts: Stock markets so far this year
TT
Here's how some of the major stock exchanges have performed so far this year (through 12 noon Friday, November 21), calculated in the same currency*, dollars, and in local currency:
Stockholm, OMXS30, +26 percent, +8 percent
New York, S&P 500, +11, +11
New York, Nasdaq, +14, +14
Frankfurt, +29, +16
Tokyo, +22, +22
*The sharp weakening of the dollar against many currencies means that, for example, the Stockholm Stock Exchange has been much stronger in dollar terms.
Source: Bloomberg
