The global rally in artificial intelligence (AI) stocks, which has been the dominant market narrative this year, is now entering a 'digestion phase' as investors recalibrate their expectations, according to market commentator Prashant Paroda. He believes that while the AI theme remains potent, some of these stocks may have run up too far ahead of their fundamentals.

Speaking on the recent sell-off in US technology stocks, Paroda described the current environment as a period of adjustment. He linked the market's nervousness to broader economic concerns in the United States, which he characterised as a 'K-shaped economy'. While infrastructure spending on AI continues to be robust, he stated that job growth has not been strong over the last few months, a point underscored by recent data show

See Full Page