Veteran Wall Street firm makes surprise call on tech stocks

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Veteran Wall Street firm makes surprise call on tech stocks originally appeared on TheStreet.
It's been nothing short of a gut punch for tech stocks this year.
AI swings, sticky interest rates, and trade-war drama have weighed down tech's rebound so far.
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As if tech didn't have enough problems, the Israel-Iran flare-up and U.S. airstrikes have added another dynamic.
However, despite the nervous energy on Friday, the markets seem relatively unfazed on Monday. One veteran Wall Street firm in particular feels the U.S. airstrikes on Iran might've helped calm the waters for tech, not shake them.
After two strong years, tech stocks took a hammering in 2025.
It kicked off in January when Chinese AI firm DeepSeek dropped its R1 model, with some of the biggest AI stocks shedding billions in days.
By mid-March, you had both the S&P 500 and Nasdaq sliding into correction territory, losing north of 10% from their peaks.As many had predicted, investors finally buckled under the weight of lofty AI multiples and sticky interest rates.
As if things weren't bad enough, Trump's trade moves had chipmakers staring down fresh tariffs and more global supply headaches.
This month, we saw the Israel-Iran conflict taking center stage with back-and-forth airstrikes adding to the geopolitical angst.
But then the U.S. finally stepped in with targeted hits on Iran's nuclear sites, and weirdly, markets liked the move.
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For tech stocks, which have been starving for clarity, that's exactly the kind of signal they need to start clawing back some of those big gains.
Wedbush feels the market's likely to shrug off the Iran strikes, with tech stocks likely to rebound with the overhang clearing out.
The veteran Wall Street firm feels most investors believed the U.S. strike was inevitable, a 'when, not if' kind of move. In their view, a weaker Iran with no nukes takes away a major threat from the Middle East and Israel. This could be bullish for stocks, especially tech, as investors process the news.
Also, the firm expects cybersecurity stocks to push higher following the news. Wedbush mentioned the likes of Palo Alto Networks, CyberArk, CrowdStrike, Zscaler, and Checkpoint to get a boost, as investors expect cyberattacks from Iran.
Over the past week, U.S. officials have anticipated low-grade cyberattacks from Iran, including DDoS hits and hacktivist noise.Meanwhile, a Politico report says pro-Iranian groups have already been meddling with utility and banking systems, forcing some countries to lock things down early.
Hence, with cyber threats heating up, next-gen defense tech is getting its moment. Smart firewalls, cloud filters, AI tools, and zero-trust setups offered by the cybersecurity bellwethers mentioned above have helped keep hackers at bay.
Wedbush also encouraged investors to buy the dips in tech winners and AI leaders like Nvidia () , Palantir () , Microsoft () , and Tesla.
Nvidia has undoubtedly been at the front of the AI pack.
Every major AI model, from GPT-style LLMs to rec engines, runs on its GPUs. With its powerful H100s for training and Blackwell chips for inference (applying trained data), they've built a position that's virtually impossible to match.
Palantir is another major AI play, with its full-stack software becoming ubiquitous for governments and big business. The company handles everything from data crunching to model control, racking up double-digit top-line growth, raising its guidance, and remaining firmly in the green.
Moreover, the recent conflict buzz has lit up Palantir's sales, with its clientele running AI straight into their data stacks. And despite the market sluggishness, Palantir stock is at the top of the heap, posting an 82% gain year-to-date.
In contrast, AI stalwart Nvidia is up just 6.6%, following an incredible rally over the last couple of years. Microsoft has also impressed, racking up a nifty 14% gain, led by booming Azure AI deployments and stronger enterprise spending.Veteran Wall Street firm makes surprise call on tech stocks first appeared on TheStreet on Jun 24, 2025
This story was originally reported by TheStreet on Jun 24, 2025, where it first appeared.