With volatility (VXX) rising sharply, stock markets will have a wider gap between the winners and the losers.
Winners
Expect technology investors to add back to their position in artificial intelligence stocks. An analyst’s upgrade of Super Computer Micro (SMCI) lifted its share price. Nvidia (NVDA) may inch higher.
Advanced Micro Devices (AMD), which trails Nvidia in the more profitable server AI market, announced AI-related offerings in its PC. Its inclusion in AMD Ryzen PRO chips might help desktop sales. Still, the PC market is a low-margin business. Dell (DELL) and HP Inc. (HPQ) prefer to offer Intel-powered (INTC) desktop chips to corporations.
In the gaming sector, Take-Two (TTWO) may bounce back. The firm is cutting around 5% of staff related to the Grand Theft Auto franchise.
Losers
Without a catalyst, Electronic Arts (EA) is not yet a buy. Shares peaked at $145 and are on a firm downtrend. Investors should also avoid gaming gear firms like Corsair Gaming (CRSR), Turtle Beach (HEAR), and Logitech International (LOGI). Customers have a tighter spending budget, hurt by inflation.
Avoid Chinese EV stocks. BYD Company (BYDDF) reportedly has excess electric vehicles parked at shipping ports in Europe. Xiaomi launched a new EV that will lose money for every unit sold. Reports are mounting that Xiaomi has quality issues, such as with its brakes.
Xiaomi’s strong launch momentum will hurt domestic EV firms including Nio (NIO), XPeng (XPEV), and Li Auto (LI).
