Let's call Monday what it was -- bloody boring. While the indexes and most stocks finished in the red, Monday's regular session was more tedious than bearish.
The Invesco QQQ Trust (QQQ) and SPDR S&P 500 ETF (SPY) traded sideways for almost the entire session, with both instruments' volume-weighted average price (VWAP) line moving almost perfectly horizontal after the first 90 minutes of trading. That said, the major index ETFs are all above their rising 10-day and 21-day exponential moving averages (EMA). The overbought nature of the market may lead to further declines or near-term choppiness, but as long as QQQ and SPY are holding above their 21-day EMAs, the bulls deserve the benefit of the doubt.
Given all the press that ChatGPT is getting, I understand why I've received an odd number of notes and emails regarding C3.ai Inc. (AI) , BigBear.ai Holdings (BBAI) and other players in the artificial intelligence sector. But in my view, the current AI frenzy is no different than past bubbles. This one likely will end the same way, with stocks such as BBAI that rally 200%, 300% or more crashing back to earth and leaving retail bagholders to clean up the mess.
If you want to invest and not trade in the future of artificial intelligence, you'd be better off looking at the companies you're already know. Companies such as Microsoft (MSFT) , Alphabet (GOOGL) and Nvidia (NVDA) likely will all benefit from the development and implementation of AI software.
Are you going to get a massive bang for your AI-investing buck by sticking a few dollars in these mega-cap stocks? No, probably not. But when the frenzy subsides and stocks such as BBAI and SoundHound AI (SOUN) collapse as investors realize it takes more than buzzwords and a fancy investor deck to develop a company, you'll be happy you sidestepped the silliness.
While I'm not in a rush to invest in C3.ai and I certainly wouldn't chase it after its recent run, it's worth noting that the company's chairman and CEO is Tom Siebel. If you've been around for a while, you probably remember Siebel Systems and its CRM software.
While SEBL was an impressive company in the late 1990s and very early 2000s, once its sales hit the skids around 2001, it failed to recover, and Oracle ORCL eventually acquired the company. The bottom line is Tom Siebel isn't new to business or Wall Street, and while Siebel Systems didn't finish as he or investors would have liked, I wouldn't necessarily assume C3.ai is destined to suffer the same fate as something such as SOUN or BBAI when the AI frenzy quiets down.
