Gaon Cable is experiencing strong gains in early trading, attributed to perceptions that concerns over increased regulations for artificial intelligence (AI) data centers in the U.S. are exaggerated.
As of 10:56 a.m. on November 10, Gaon Cable shares rose by 27,750 won (15.77%) to 203,750 won compared to the previous trading day.
The surge in Gaon Cable's stock appears to be linked to a reduction in fears regarding a slowdown in investments in AI data centers in the U.S. The company is expanding its business in power cables and transmission networks for AI data centers, particularly through its U.S. subsidiary, LSCUS.
According to a report from Reuters, Morgan Stanley and UBS assessed that the recent sell-off in AI-related stocks was excessive. They noted that the market may have overreacted to the possibility of stringent regulations on data center development proposed by a Democratic-led Congress. Consequently, the Nasdaq Composite Index rose by 2.74%, reflecting improved investor sentiment in technology stocks.
Morgan Stanley projected that regulatory changes could delay some data center projects from 2028 to 2029. However, they also suggested that if investment timelines are staggered, the AI investment cycle could extend, alleviating supply-demand imbalances in the data center supply chain.
UBS commented that the market is overly pessimistic about the political and credit risks surrounding AI, as well as the burden of capital investment. HSBC also indicated that following last week's stock declines, they are increasing their equity investment in U.S. and Asian technology stocks.
Seo Sang-young, a managing director at Mirae Asset Securities, stated, "Morgan Stanley, UBS, and Jefferies have evaluated the concerns over reduced AI investments due to data center regulations as excessive," adding that the easing of fears regarding AI investment cuts and ongoing expectations for capital investment have led to gains in semiconductor equipment and optical communication stocks on the New York Stock Exchange.
As of 10:56 a.m. on November 10, Gaon Cable shares rose by 27,750 won (15.77%) to 203,750 won compared to the previous trading day.
The surge in Gaon Cable's stock appears to be linked to a reduction in fears regarding a slowdown in investments in AI data centers in the U.S. The company is expanding its business in power cables and transmission networks for AI data centers, particularly through its U.S. subsidiary, LSCUS.
According to a report from Reuters, Morgan Stanley and UBS assessed that the recent sell-off in AI-related stocks was excessive. They noted that the market may have overreacted to the possibility of stringent regulations on data center development proposed by a Democratic-led Congress. Consequently, the Nasdaq Composite Index rose by 2.74%, reflecting improved investor sentiment in technology stocks.
Morgan Stanley projected that regulatory changes could delay some data center projects from 2028 to 2029. However, they also suggested that if investment timelines are staggered, the AI investment cycle could extend, alleviating supply-demand imbalances in the data center supply chain.
UBS commented that the market is overly pessimistic about the political and credit risks surrounding AI, as well as the burden of capital investment. HSBC also indicated that following last week's stock declines, they are increasing their equity investment in U.S. and Asian technology stocks.
Seo Sang-young, a managing director at Mirae Asset Securities, stated, "Morgan Stanley, UBS, and Jefferies have evaluated the concerns over reduced AI investments due to data center regulations as excessive," adding that the easing of fears regarding AI investment cuts and ongoing expectations for capital investment have led to gains in semiconductor equipment and optical communication stocks on the New York Stock Exchange.
* This article has been translated by AI.
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