The exuberance surrounding artificial intelligence has driven a lot of capital into a small corner of the market in a very short space of time, and that has implications for tech-heavy ESG funds. An analysis by Bloomberg Intelligence shows that tech makes up a third of preferred stocks in so-called Article 9 funds, the highest ESG classification in the European Union. About 1,300 ESG-registered funds hold more than $20 billion in Nvidia alone, according to data compiled by Bloomberg. But the buying spree has been fed by “just a few sectors,” in fact, just a handful of stocks, Penny said. “I would be focusing less on AI manufacturers and more on AI adopters, so that ‘pick-and-shovel”’ kind of strategy.

Source: The Hindu June 13, 2023 10:15 UTC