Has AI trading in the US stock market ended? Goldman Sachs speaks out: Investors will return, and "Phase Three AI Trading" is the most worthy of attention
Goldman Sachs analysts stated that despite the volatility of AI trading, investors remain optimistic about its future. The report pointed out that AI trading is divided into four stages, with "Stage Three AI Trading" being the most attractive due to its ability to achieve revenue growth through AI technology. Although the market needs to adjust in the short term, Goldman Sachs believes that technological advancements and profit growth will attract investors back
Since 2025, AI trading has experienced significant volatility, and the rise of DeepSeek has severely impacted the U.S. stock market. This has led investors to begin questioning whether the feast of AI trading has come to an end.
Goldman Sachs analysts Ryan Hammond, David J. Kostin, and others stated in a report released on March 6 that although the market needs a "position clearing" or improvement in economic data in the short term to reverse the situation, the continuous advancement of AI technology and profit growth will ultimately attract investors back.
Goldman Sachs believes that AI trading will continue to expand, and "Phase Three AI trading," which refers to companies that can achieve revenue growth through AI technology, is more attractive than "Phase Two AI trading."
AI Trading "Roller Coaster," Market Sentiment Dismal
In the report, Goldman Sachs categorized AI sector stocks into three phases: "Phase One" refers to AI chip stocks led by Nvidia, "Phase Two" refers to stocks related to AI infrastructure, "Phase Three" refers to companies that can generate revenue through AI technology, and "Phase Four" refers to companies benefiting from AI-driven productivity improvements.
The report pointed out that recently, AI trading has been hit by a double blow of lowered economic growth expectations and position adjustments—slowing economic growth has raised concerns about corporate AI spending capabilities, while many Phase Two and Phase Three AI stocks have been favored by investors, leading to heavy positions.
Looking at the specifics, since the S&P 500 index peaked on February 19, Nvidia has lagged the equal-weight S&P by 16 percentage points, AI infrastructure stocks and AI revenue-generating stocks lagged by 9 and 7 percentage points, respectively, while AI productivity improvement stocks had the smallest decline, lagging the equal-weight S&P 500 by 3 percentage points.
Valuation Low + Earnings Outlook: Phase Three AI Stocks Welcome Opportunity
Overall, Goldman Sachs remains optimistic about the long-term prospects of AI and believes that continuous technological advancements and profit growth will ultimately refocus investors on AI stocks.
The report indicates that in the short term, the market needs a "position clearing" or improvement in economic data to reverse the situation. Goldman Sachs' sentiment indicator fell to -0.4 last Friday, still above the "bottom" level during past market corrections, indicating that positions have not yet dropped low enough to support a tactical rally.
Goldman Sachs also mentioned that Phase Three AI stocks are more attractive than Phase Two AI stocks. As the growth rate of large enterprises' AI capital expenditures slows and AI costs continue to decline, investors' focus will shift from infrastructure to the promotion of technology applications and revenue generation.
Meanwhile, despite having undergone a round of sell-offs, the relative valuation of Phase Two AI stocks remains slightly above their historical average, while the valuation of Phase Three AI stocks is relatively low.
It is worth noting that Phase Three AI stocks have experienced positive sales revisions this year, with their median sales expectations for 2026 raised by 0.3%, while both Phase Two and Phase Four AI stocks have seen negative revisions, with their median sales expectations for 2026 lowered by 0.3%In the list of Stage Three AI stocks compiled by Goldman Sachs, a total of 40 companies are included, among which 27 are software companies. The companies expected to have the fastest sales growth in the next two years include: Palantir (PLTR), Cloudflare (NET), SentinelOne (S), and GitLab (GTLB).
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