Investment bank Wedbush: The tech stock sell-off caused by the Federal Reserve is a "buying opportunity".

Investment bank Wedbush Securities stated that the significant sell-off in the stock market on Wednesday sparked by the Federal Reserve's "no longer dovish" stance is just a "buying opportunity". The company's analyst wrote in a report to clients, "Over the past few years, we have been guiding investors along the path of the Federal Reserve, and this sell-off is just another buying opportunity for us to have a place in the strong artificial intelligence revolution of 2025." "As bears awaken from hibernation after missing out on historic tech rebounds, we will see more turbulent days (Fed, Trump tariff concerns, etc)but it won't ultimately lead to a soft landing for risk assets and bullish backdrop." Softbank-led investment wave The company listed three major "key positive factors" for large tech companies by 2025, one of which includes Softbank founder Masayoshi Son announcing a $100 billion investment in the United States over the next four years, partly due to the incoming Trump administration. Analysts predict that Washington will launch a "significant" artificial intelligence program next year, which will benefit tech companies like Microsoft Corporation, Amazon.com, Inc., and Alphabet Inc. Analysts added that artificial intelligence should also become a major part of defense spending, potentially driving companies like Palantir and Oracle Corporation. Analysts wrote, "We believe that Softbank CEO Masayoshi Son's $100 billion AI investment announced at the Lake Hukou is just the beginning of more global AI investments for the US, which is a positive backdrop for a wider range of technology and AI sectors." Relaxed regulations Another positive factor is Lina Khan leaving the Federal Trade Commission and Andrew Ferguson taking over her position. While Ferguson has "sharp insights" into the tech industry, he is expected to revoke most of Khan's "perplexing anti-tech agenda". "In fact, Christmas has come early for the tech world, as Khan's threat has been eliminated at a critical moment in the AI arms race. We expect the strong to get stronger as the Big Seven re-engage their M&A engines, Microsoft Corporation, Oracle Corporation, Alphabet, Amazon.com, Inc., and Tesla, Inc. will all accelerate deals to expand their technology moats," the analyst wrote. Musk and Trump Lastly, given Musk's close relationship with President-elect Trump, Tesla, Inc. and Musk are expected to benefit. The bank stated that Trump may accelerate the timeline for Tesla, Inc.'s fully autonomous driving and self-driving plans. The analyst wrote, "We believe that Trump's entrance into the White House will help unlock Tesla, Inc.'s $1 trillion value in autonomous driving/AI, as FSD will accelerate from 2025 onwards, which is a key driver for Cybercab."