UBS Says AI Stock Selloff Nears End, Backs Staggered Buying

AI and semiconductor momentum stocks have come under pressure as investors lock in gains and reassess whether elevated technology valuations remain justified. UBS said the sector’s underlying fundamentals remain favorable, supported by resilient demand and continued investment in artificial intelligence. The bank’s view suggests the recent pullback is a market correction rather than evidence that the longer-term AI growth cycle has reversed.

UBS expects the selloff in AI-related and semiconductor momentum shares to run its course by the end of the month at the latest, potentially creating opportunities for investors to rebuild exposure. Market experts favor a cautious, staggered buying strategy instead of committing capital all at once. Investors should still prepare for volatility, particularly if fund flows rotate rapidly back into AI stocks and trigger sharper moves in prices and trading momentum.