Japan¡¯s largest tech fund says AI stocks are not in a bubble and have room to rise further.

The AI market is "just entering its second act,¡± said Yasuyuki Fukuda, chief portfolio manager of Nomura Asset Management¡¯s Japanese Information Electronics equity fund, and "not at the bubble stage.¡±

Concerns have been brewing over the global AI boom that has pushed the market capitalization of the U.S. chip giant Nvidia past the $5 trillion mark, the highest valuation ever for a company. With seven large tech companies now accounting for more than one-third of the S&P 500 index¡¯s weighting, investors are asking if this is a sign of overheating, foreshadowing a possible burst of an asset bubble.