I don't think the AI wave is finished. I think the beat on earnings of $NVIDIA Corp(NVDA)$ proved another blowout quarter, and the indications are even for more of the same in the coming quarters, however.
We have $NVIDIA Corp(NVDA)$and company $C3.ai, Inc.(AI)$ having more than tripled so far this year. It tells you how young the market is because a lot of most of the money is just going into a few names that are already established.
So as the industry matures, you will start to see money flow out of these already very profitable positions into those new up-and-coming names.
So it's not yet over with AI investments about to hit $200 billion by 2025. So, these are industries that are established and still have a long runway for growth.
In the second half of 2023, I think two industries will continue to be bullish.
The first one is semiconductor, semiconductors are going to be one of the right sectors in the industry. With companies like $Taiwan Semiconductor Manufacturing(TSM)$ now pushing 2-nanometer production, we're going to have a range of new applications that's gonna open a host of new demand for semiconductors, maybe the outlook is so strong 18% growth for the industry next year after a week year this year.
And you got a lot of the demand coming from China as well despite the chip sanctions that are starting to get in place, a lot of companies are ordering a lot more. So, the way to play this I think would be to buy shares in the ETFs like $iShares Semiconductor ETF(SOXX)$ , $VanEck Vectors Semiconductor ETF(SMH)$ , and $VanEck HIP Sustainable Muni ETF(SMI)$ . These are the ETFs to play in the semiconductor industry.
As of 25th AUG
One other outlier I'd like to suggest is the gaming entertainment industry is going to outperform in the second half of 2023.
The gambling market is huge, It's going to hit 1.4 trillion this year. The US market is the biggest gambling market in the world hitting record highs this year. And China's full reopening has yet to play out. Macau was at one time generating, I think, three times the gaming revenue of Las Vegas alone.
And the gross gaming revenues in Macau are still around 30 to 50% below their pre-pandemic levels. So, you have a lot of upside there when it gets back to normal. So, I'm bullish on this particular sector for the second half of 23. And the other two ETFs to write this, $VanEck Vectors Gaming ETF(BJK)$ and $BlackRock Credit Allocation Income Trust(BTZ)$.
As of 25th AUG
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