Goldman Sachs Group Inc GS is of the opinion that artificial intelligence could help boost S&P 500 Profits in the next 10 years.

“Over the next 10 years, AI could increase productivity by 1.5% per year. And that could boost S&P 500 gains by 30% or more over the next decade,” said Goldman’s chief strategist ben snider told CNBC on Thursday.

He pointed out that while many of the positive factors driving the rise in S&P 500 earnings appear to be reversing, the real source of optimism today is productivity gains from artificial intelligence.

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“Most investors are aware that the immediate winners are in the technology sector,” Snider added. “The real question for investors is who will be the winners going forward.”

In fact, investors appear bullish on tech companies, as reflected in stock performance so far in 2023. Meta Platforms Inc META is among the top performers among mega-cap technology stocks, up over 94% year-to-date.

Both in the same period apple inc AAPL and Alphabet Inc GOOG GOOGL have returned over 35%. microsoft corp MSFT Shares are up over 31% year-to-date, according to Benzinga Pro.

Snider also noted that during the tech bubble, it’s very hard to imagine such a bubble Facebook or Uber Technologies Inc ABOVE “changing the way we live our lives.”

Markets and Fed: The strategist advised investors to diversify their US equity investments between cyclical and defensive sectors, highlighting the attractive valuations of the energy and healthcare sectors.

Regarding the interest rate trend, Snider said he expects it Federal Reserve has has completed most of its monetary tightening. “The question is: What impact will this have on the economy going forward?” Snider said. “One sign of concern in the recent earnings season is that companies in the S&P 500 are beginning to scale back some of their corporate spending.”

Explain how elevated…