Nasdaq recovers all losses since the US-Iran conflict. Oracle Corporation (ORCL.US) soars over 12%. Morgan Stanley says market correction may have entered the latter stage.

Against the backdrop of the continuous heating up of the artificial intelligence theme and the gradual digestion of market risks, the US technology sector performed strongly on Monday, with both the S&P 500 index and the Nasdaq regaining all the losses since the outbreak of the US-Iran conflict. Oracle Corporation (ORCL.US) surged due to progress in its AI business, while NVIDIA Corporation (NVDA.US) achieved gains for the ninth consecutive trading day. Oracle Corporation Leads the Market with AI Applications Landing At the Customer Edge Summit, Oracle Corporation showcased its AI solutions in the utilities sector, including products such as "Utilities Opower" and "Aconex." The company stated that these tools have helped customers achieve significant energy savings and improve project management efficiency. Boosted by this, Oracle Corporation's stock price rose by over 12%, to around $155.62, making it one of the top gainers in the S&P 500 on that day. However, looking at its performance for the year, the stock has still accumulated a decline of about 21%, with a pullback of over 50% from its historical highs, and the market remains concerned about its sustainability in monetizing AI. NVIDIA Corporation Continues to Strengthen, with Compute Demand Supporting Long-term Logic Meanwhile, NVIDIA Corporation's stock price rose by 0.36% to $189.31, achieving gains for the ninth consecutive trading day, with a cumulative gain of over 14% in the past eight trading days, significantly outperforming the market. Institutions generally have a positive outlook on its fundamentals, believing that the company's leading position in AI computing power will continue to benefit from industry expansion. The market expects its earnings per share to grow by around 71% in the 2027 fiscal year, with a gross margin remaining at around 75%, and the new generation Vera Rubin chip is also seen as a significant catalyst for future growth. However, some views point out that its valuation is already at a high level. Morgan Stanley: Market has digested most of the risks At the overall market level, Morgan Stanley believes that this round of correction may have entered its later stages. Data shows that since October last year, the S&P 500 forward P/E ratio has fallen by about 18% from its peak, a correction magnitude that typically occurs during an economic recession or during a significant tightening cycle by the Federal Reserve, which is not the current scenario. More importantly, the adjustments within the market are more significant. Over half of the stocks in the Russell 3000 index have declined by more than 20%, indicating that the market has already factored in a large number of risk factors ahead of time, rather than being in an overly optimistic state. In the AI field, Morgan Stanley points out that market expectations of "disruptive impact" are ahead of actual applications. In the short term, AI is more likely to enhance corporate profit margins rather than compressing earnings space, as reflected in the double-digit growth in corporate earnings, achieving the fastest growth since 2021. However, the institution also warns that the final stages of market correction often accompany volatility, and if interest rates or the bond market experience volatility again, a double bottom scenario cannot be ruled out.