Global markets have performed poorly in recent weeks, marked by Trump’s policy of chaos. The technology sector was hit especially hard, with the Mag7 index recording in February its worst month since the end of 2022 relative to the S&P 500. Semiconductor companies involved in artificial intelligence suffered from profit-taking, amplified by the export restrictions imposed on China by the US administration.
What’s our take on this?
Key messages from the PMs of Pictet-Digital and Pictet-Robotics
The fundamentals of the two strategies have not changed. They remain very solid, as shown by the latest results, despite the major macroeconomic and geopolitical challenges. Pictet will take advantage of the market downturn to strengthen our strongest convictions, which now have attractive valuations.
Despite the challenges, AI remains at the centre of the attention due to the advances of the past year and possible changes in capital spending on AI following the DeepSeek announcement.
Capital spending and infrastructure for AI continue to grow, which has a positive impact on the entire semiconductor value chain for AI (semiconductor design, semiconductor software, semiconductor equipment and semiconductor manufacturing). Pictet only anticipate a turning point in the semiconductor sector in the areas of analog semiconductors and certain industrial companies where inventory rebuilding has not yet really started. The automobile sector and industrial markets remain difficult, but positive signs are starting to emerge in consumer electronics.
Most cybersecurity companies are confident in their ability to overcome short-term headwinds, due to an important increase in demand driven by AI and favourable cybersecurity legislation to boost the second half of 2025. Pictet also expect firewall updates this year, which also creates interesting opportunities.
Pictet continue to highlight the resilience and adaptability of digital and robotic companies amid macroeconomic uncertainties and geopolitical challenges. AI remains a central focus, with continued investment in infrastructure and technology to support its growth. However, there is short-term volatility and we remain vigilant in light of the importance of strategic responses to tariffs, FED spending, and the evolving AI and cybersecurity landscape.
For a more detailed overview, we invite you to replay the webcast on Pictet-Digital with John Gladwin and Stanislas Effront, from the investment team, by clicking on this link. Please find herewith also the webcast summary.
