JPMorgan strategists predict rebound for technology stocks

JPMorgan’s equity strategy team, led by Dubravko Lakos-Bujas, is telling investors to stop panicking about artificial intelligence eating the software industry alive. Their latest analysis argues that fears of AI disrupting traditional software businesses are “largely exaggerated,” and that the recent selloff has created a buying opportunity in high-quality tech names. The strategists project annual profit growth of 16.8% for the software industry by 2026, a figure that doesn’t exactly scream existential crisis. Their recommendation: increase exposure to software firms with strong fundamentals and resilience to near-term AI headwinds. The case against AI doom JPMorgan’s team points to structural advantages that established software companies hold, particularly high switching costs and long-term client contracts. When a Fortune 500 company has spent years integrating a platform into its operations, ripping it out for an AI alternative isn’t a weekend project. Two names stood out in the JPMorgan report: Microsoft and CrowdStrike. Both were highlighted not as victims of the AI revolution, but as beneficiaries of it. Microsoft has been embedding AI capabilities across its product suite...