Stocks of tech giants are boosted as the S&P 500 rises by 9% owing to a trend driven by ChatGPT

(Image credit- Barron's) The tech sector is concerned about the possible effects of artificial intelligence (AI), which is developing quickly, on profitability and productivity. It's interesting to note that this enthusiasm for AI is transforming business and fueling a huge uptick in the stock market, especially within the S&P 500.

How the Stock Market is Being Affected by the Recent AI Trend

According to the reports, a small number of significant stocks at the forefront of the AI revolution are to blame for the astounding 9% increase in the S&P 500 this year. The growing interest in the chatbot sensation ChatGPT is a major factor in their success. The index's year-to-date gain has been boosted by tech behemoths that have been early adopters of AI, including Microsoft, Alphabet, Apple, Nvidia, and Meta Platforms. According to Rabe, the AI craze is responsible for 25% to 50% of these stocks' increases. [caption id="" align="aligncenter" width="1135"] Image credit- Visual Capitalist[/caption]   According to Bloomberg, investors with an interest in artificial intelligence have increased Nvidia Corp.'s share price by 96% this year. Nvidia Corp. produces the chips needed for difficult AI computer tasks.

Stocks Related to AI

According to the reports, Societe Generale recently examined 20 stocks that are frequently owned by exchange-traded funds (ETFs) with an interest in artificial intelligence. The results showed that this year, these funds' assets under management increased by over 40%. Founder of Privacy Search Company Neeva, an ex-Google executive, explains why the company is focusing more on AI. The S&P 500's performance would decline by roughly ten percentage points and turn negative for the year if these AI-related stocks were taken out of the index. Manish Kabra, head of US equities strategy at Societe Generale, stresses the allure of this market topic and emphasizes the superior returns produced by AI-driven firms.

AI Stocks' Potential for Profit

Analysts are anxiously awaiting the financial benefits that could result from advances in AI, which provide new revenue prospects and productivity gains. Also read: Tesla can still dominate US EV market, but rivals are catching up