Investment Bank Piper Sandler Removes Nvidia From Model Portfolio, Anticipating S&P 500 Correction: 'Cool The Engines'
Portfolio Pulse from Benzinga Neuro
Piper Sandler, anticipating a 5% to 10% correction in the S&P 500 due to inflated valuations and decelerating momentum, has removed Nvidia Corp. (NASDAQ:NVDA) from its model portfolio. The investment bank cited concerns over Nvidia's escalating costs despite its strong position in the AI sector. Instead, Piper Sandler has added Micron Technology Inc. (NASDAQ:MU) and Taiwan Semiconductor Manufacturing Co. (NYSE:TSM) to its portfolio, reducing equity exposure from 98% to 90% and allocating 10% to cash.
March 28, 2024 | 11:14 am
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POSITIVE IMPACT
Micron Technology Inc. added to Piper Sandler's model portfolio as the bank seeks alternative AI investments amid a forecasted S&P 500 correction.
The inclusion of Micron Technology in Piper Sandler's model portfolio suggests a positive outlook for the company, especially as the bank seeks alternatives to Nvidia. This could attract investor interest and potentially boost Micron's stock in the short term.
CONFIDENCE 80
IMPORTANCE 70
RELEVANCE 80
POSITIVE IMPACT
Taiwan Semiconductor Manufacturing Co. included in Piper Sandler's model portfolio, indicating a shift towards alternative AI investments.
TSMC's addition to Piper Sandler's model portfolio is a positive signal, reflecting the bank's confidence in TSMC as a strong alternative AI investment. This could lead to increased investor interest and a positive impact on TSMC's stock price in the short term.
CONFIDENCE 80
IMPORTANCE 70
RELEVANCE 80
NEGATIVE IMPACT
Nvidia removed from Piper Sandler's model portfolio amid S&P 500 correction forecast, due to concerns over escalating costs despite its strong AI sector position.
Nvidia's removal from Piper Sandler's model portfolio could lead to negative investor sentiment in the short term, especially given the reasons cited for its removal. The anticipation of a market correction and concerns over Nvidia's costs could pressure the stock.
CONFIDENCE 85
IMPORTANCE 80
RELEVANCE 90