Wall Street analysts split on September market outlook amid AI stock divergence

Financial analysts and investment committees are navigating divergent views as the market enters September, a month historically characterized by weakness. While some institutional desks, such as JPMorgan’s trading desk and Wells Fargo, have moved toward neutral or cautious stances due to concerns over peaking AI spending, other investment experts are maintaining bullish positions.

Technical analysts have highlighted internal market vulnerabilities that may not be visible on standard price charts. Mizuho’s multi-asset team noted that momentum baskets have broken below previous lows, driven by systematic de-risking. Similarly, JPMorgan’s technical strategy has drawn parallels to the pre-dot-com bubble era of 2000, pointing to a divergence between semiconductor companies and the hyperscalers funding the AI buildout. While the S&P 500 remains technically bullish, the disconnect between chip suppliers and capital spenders suggests potential underlying instability.

In contrast, members of CNBC’s Investment Committee expressed a refusal to sell, viewing market dips as opportunities to add to positions. They noted that despite seasonal trends, factors such as significant corporate buybacks and the rotation from momentum to quality may provide a floor for the market.