“AI will continue to lead this upcycle on the growth in data centre capex in 2025 and more confidence in 2026 growth,” analysts including Gokul Hariharan wrote in a report.

“We are not advising any meaningful rotation away from AI stocks in the next three months and would prefer” to stick with the winners.

AI stocks are rapidly emerging as pivotal drivers of the region’s equity markets, underpinned by a robust domestic appetite for automation and generative technology.

A Bloomberg regional semiconductor index has risen over 12% this year to outperform an Asian equity gauge, and resilient demand for AI memory chips from big tech providers may drive further gains.

“Semiconductor Manufacturing Co, SK Hynix Inc, Advantest Corp and Delta Electronics Inc.

“Those shares should continue their upward momentum in the next 12 months, as demand is not an issue and earnings will continue to be revised up,” they wrote.

The investment bank is more cautious on non-AI stocks, such as makers of personal computers, smartphones and consumer devices.

“Earnings downward revisions may continue as the impact of China consumption subsidies fades,” the report added.