Stocks are near all-time highs, but strategists are not worried about an AI bubble – yet. The S&P 500 is up over 17% this year, driven by a 26% increase in tech stocks. Experts see similarities to past bubbles, but predict tech will lead the market higher.

Semiconductor stocks like Nvidia are redefining the industry, with Nvidia’s market cap hitting $4.6 trillion. The company recently announced a $20 billion licensing deal with Groq. Alphabet’s Google is also making waves with its specialized customer chips called TPUs.

Analysts forecast robust earnings growth and AI advancements to support market gains. UBS expects the S&P 500 to reach 7,700 by the end of next year. Veteran strategist Ed Yardeni sees the index hitting the same level, citing tax benefits and the AI boom as key drivers.

Goldman Sachs argues the stock market isn’t in a bubble, as tech growth is based on actual performance. The firm believes earnings growth will expand beyond the largest seven stocks. AI productivity is expected to boost earnings for companies outside the top performers.

Read more at Yahoo Finance: Why Wall Street thinks the stock market can keep climbing even as AI anxiety grows