AI Boom Is Far From Over as Analysts Predict Stronger Recovery in 2027
Artificial intelligence stocks could regain momentum in the second half of 2027 as excessive market expectations ease and investors assess the impact of tighter U.S. data center regulations, according to Daiwa Securities strategist Yugo Tsuboi, who argues that the recent selloff represents a market adjustment rather than the beginning of a prolonged downturn in AI investment. (News On Japan)
Tokyo - AI stocks may experience renewed growth in the second half of 2027, as analysts predict a stronger recovery following recent market volatility, according to Daiwa Securities strategist Yugo Tsuboi. The recent decline in AI-related stocks was primarily driven by trading adjustments and risk management strategies rather than fundamental economic issues.
Tsuboi emphasized that the downturn did not resemble a full-blown financial crisis, as interest rates remained stable and there was limited selling of safe-haven assets. The recent correction has reduced inflated expectations for AI-related valuations, bringing prices closer to more sustainable growth assumptions. However, a prolonged slowdown in AI investment could negatively impact global economic growth, potentially reducing the 2027 growth rate to around 2.4% if the pessimistic scenario discussed by Tsuboi materializes.
The growth slowdown could be mitigated by moderate stabilization in AI-related infrastructure investment, but political resistance to data center expansion in the United States remains a significant uncertainty.
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