Wedbush analysts told investors in a note Thursday that the firm uses the "current macro and Fed worries as a time to double down on our bullish tech thesis....and NOT panic."
The analysts believe the current macro and yield surge fears are overshadowing the artificial intelligence (AI) growth story.
"Clearly the nervousness of the rising 10-year yields and the hawkish Fed has been the straw that broke the camel's back for the markets with tech stocks under heavy pressure over the past week," they stated.
"The transformational growth around AI, cloud, cyber security, and rebound of digital ad dollars will create a springboard of growth into 2024 that is currently being underappreciated by the Street," the analysts added.
Wedbush believes the Fed will cut in 2024, and the "near-term obsession with the 10-year will dissipate" as yields move lower and the soft landing takes place in 2024 with the Fed's hand forced.
"We fully get that the bears now have all come fully out of hibernation mode and will yell fire into a crowded theater again creating agita and panic for the bulls...but instead we focus on this generational AI growth and $1 trillion of tech spending now on the horizon over the next decade," said analysts.
Wedbush expects a positive earnings season for big tech, which they see as a sneak preview for a "major rebound" in tech sector growth in 2024.