AI Investment Thesis Took Its Lumps, But Remains Sturdy

Core Viewpoint - November was challenging for large- and megacap growth stocks, with the Nasdaq-100 and S&P 500 Growth indexes ending the month in negative territory, primarily due to an AI-related sell-off, which some are referring to as an "AI freak-out" or "shake-out" [1] Group 1: Market Performance - The Nasdaq-100 and S&P 500 Growth indexes finished in the red in November [1] - The recent pullback in AI-heavy stocks is viewed as a healthy correction rather than a long-term trend [1] Group 2: Investment Sentiment - Despite the recent downturn, the sentiment around AI investments remains positive, with expectations for growth in 2026 [1] - The AI investment thesis is still considered intact, with potential catalysts for ETFs like QQQ and QQQM [1] Group 3: Future Outlook - Federal Reserve rate cuts are anticipated to benefit growth stocks, which are expected to thrive in 2026 [1] - AI adoption is projected to be a significant theme in the upcoming year, supported by evidence from corporate activities [1] - Historical parallels are drawn to the 1990s internet boom, suggesting that current AI investments may lay the groundwork for substantial future businesses [1]