REUTERS: Michael Landsberg: ‘I Wouldn’t Buy Tech on the Dip’

March 18, 2025

“We’re not less bullish on AI in the long term, but in the short term, you have to be cautious after the run it’s had,” says Michael Landsberg, Chief Investment Officer at Landsberg Bennett Private Wealth Management, during his discussion with Reuters Market Talk. As shares of semiconductor companies declined, Landsberg pointed to slowing economic growth, uncertainty around tariffs, and broad investor overexposure to the sector as reasons to avoid buying the dip in technology stocks. He believes investors should rotate into more defensive areas, such as insurance and utilities, rather than chasing declines in AI-related names.

Key Takeaways:

  1. Tech sector faces headwinds: “We’re in a trend now where the economy is slowing, there are concerns about tariffs, and bluntly, everybody and their brother owns these names,” says Landsberg. He attributes the sell-off in AI-related stocks to investors reducing exposure after years of strong gains.
  2. AI stocks not a buy yet: “I wouldn’t buy tech here on the dip,” Landsberg says, citing an environment of slowing growth and inflation, which typically does not favor technology investments. He believes there are better opportunities elsewhere.
  3. Market bottom not in sight: “I don’t think you’re going to see a bottom for a little bit, specifically in tech,” he warns, noting that decelerating growth and tariff uncertainty will likely continue pressuring markets.
  4. Rotation to defensive sectors:“We favored insurance stocks and utilities in the U.S. because they’ve held up during this period of time,” says Landsberg. He points out that many investors are overweight in technology stocks and suggests diversifying into more stable sectors.
  5. International markets may offer better opportunities:“I like out of the country right now. I think Europe is really an opportunity here,” Landsberg says, noting that European economies are showing growth without the trade policy uncertainties facing the U.S.
  6. Stock recommendations: Landsberg highlights a Florida-based power company as an attractive utility play, citing strong demographic trends and exposure to renewable energy. He also favors a major insurance provider, stating, “I never vote against insurance companies. They always figure out how to make money.”
  7. Small-cap stocks remain unattractive: “I would tell clients to stay away from the small-cap market,” Landsberg says, adding that small caps have been negative for over three years, and cheaper valuations do not necessarily indicate a turnaround.

Landsberg advises investors to remain patient, focus on defensive sectors, and avoid increasing exposure to technology stocks amid ongoing uncertainty around tariffs and economic growth.

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