09:24 AM EDT, 09/19/2024 (MT Newswires) -- The Federal Reserve's decision to lower the federal funds rates rate by 50 basis points is a "very bullish backdrop" for a risk-on trade of big tech companies and artificial intelligence heading into 2025, Wedbush said in a note Thursday.

The rate cut was the "missing piece" in the puzzle as a lot of investors were looking for a green signal for the tech growth trade into this year's end and 2025, analysts led by Daniel Ives wrote.

The tech supply chain is preparing for a huge growth period ahead as roughly $1 trillion of artificial intelligence capital expenses are expected to be on the horizon in the near future, the analysts said.

"We continue to strongly believe its 9 pm in the AI Party that goes till 4 am," Wedbush said.

Alongside Nvidia ( NVDA ) and Microsoft ( MSFT ) , many other tech companies are joining the AI party including Oracle (ORCL), ServiceNow ( NOW ) , Palantir Technologies ( PLTR ) , Salesforce ( CRM ) , Dell Technologies ( DELL ) , International Business Machines ( IBM ) , Apple ( AAPL ) , Advanced Micro Devices ( AMD ) , and others, the analysts said.

"We continue to estimate for every $1 spent on an Nvidia GPU chip there is a $8-$10 multiplier across the tech sector which speaks to our firmly bullish view of tech stocks over the next year," according to the Wedbush analysts.

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