By Peter Wechsler
President & Co-Founder, Franklin Retirement Solutions
[email protected]
As I pen this column on Thursday morning, I realized that it’s not only June 4th, but today would have been my mother’s 100th birthday. Mom died way too young at 61, but she outlived my dad, who died at 47. Yes, I was orphaned at a relatively young age.
Mom played a key role in our vending business; she ran the money room, counting coins and currency all day long. It took me a while, but I finally got her to save all the crisp fifty- and hundred-dollar bills that came in from our cafeterias or from the change our route men made for customers. Yes, I still miss the cash, 29 years after we sold the business.
As for the markets, the war, the economy, inflation, and energy prices, I could write a book about all the crosscurrents going on. Let’s focus on the markets—specifically tech stocks, and especially AI.
It’s been a crazy year so far, with the tech-heavy Nasdaq up 15.5% year-to-date. Last year, the Nasdaq was up 20%, with returns of 28% in 2024 and 43% in 2023. An impressive run—but will it continue? Good question, and nobody knows.
What we do know is that SpaceX and Anthropic (AI) are about to go public, and their IPOs are expected to raise a huge amount of money. What we don’t know is how this will affect the rest of the tech sector, so we are watching closely.
Ultimately, the stock market is based on corporate profits, and so far this year, profits have been holding up. But even Wall Street darling Nvidia (NVDA) is only up 15% this year, while Micron is up 278%, SanDisk is up 671%, and Bloom Energy is up 230% year-to-date.
A column in this week’s Barron’s magazine discussed tech stocks and said these five stocks are the ones to keep in your portfolio long term:
- Advanced Micro Devices (AMD)
- Broadcom (AVGO)
- Micron (MU)
- Nvidia (NVDA)
- Taiwan Semiconductor (TSM)
I’m not telling you to buy these stocks, and I guess only time will tell if this is a good strategy. But for now—meaning as of yesterday—it looked like a good strategy.
With all the negative news and concerns over inflation, energy prices, and the war, the market keeps chugging along. Enjoy the good times, and enjoy the upcoming warm weekend…
Peter