Despite turbulent market conditions, Alphabet Inc., the parent company of Google, captured significant investor attention this week by posting a nearly nine per cent gain. The surge was fueled by a dual catalyst: the launch of its advanced artificial intelligence model, Gemini 3, and the revelation that legendary investor Warren Buffett had initiated a position in the tech giant.
Alphabet Defies the AI Selloff
While broader markets wobbled on fears that the artificial intelligence trade was overextended, Alphabet stood out as a notable performer. The company introduced Gemini 3 in mid-November, and analysts at TD Cowen suggested this new large language model could help Google's AI offerings close the gap with ChatGPT. Analyst John Blackledge noted that consumer surveys indicated steadily rising user engagement for Gemini, a positive trend for the company's competitive stance in the AI arena.
The stock received a further boost from a Bloomberg report confirming that Warren Buffett's Berkshire Hathaway had taken a stake. This move is significant given Buffett's historical caution toward technology stocks. Despite the recent rally, most analysts have maintained the price targets they set after Alphabet's earnings report in late October. The consensus 12-month price target for Alphabet is US$322.68, with shares trading around US$302 as of Friday.
Canadian Infrastructure: Round Two Unlocks New Opportunities
Shifting focus to Canadian markets, analysts at the Bank of Nova Scotia have expanded their list of stock recommendations following the government's announcement of a second round of major infrastructure projects. Prime Minister Mark Carney unveiled six new projects of national interest, building on the five proposed in mid-September.
The new projects are diverse, ranging from an electricity transmission corridor and a floating liquefied natural gas (LNG) terminal in northern British Columbia to critical mineral mines in New Brunswick, Ontario, and Quebec, and a hydro line extending to the Arctic.
Scotiabank's analysis identifies several potential beneficiaries across various sectors:
- Energy & Pipelines: Enbridge Inc. (TSX:ENB) could be involved in building a pipeline for the LNG terminal. Alberta gas companies like AltaGas Ltd. (TSX:ALA), Keyera Corp. (TSX:KEY), and Pembina Pipeline Corp. (TSX:PPL) may also see benefits, while TC Energy Corp. (TSX:TCL) could be tapped for further pipeline investments.
- Engineering & Construction: Firms like AtkinsRealis Group Inc. (TSX:ATRL), Stantec Inc. (TSX:STN), and WSP Global Inc. (TSX:WSP) are well-positioned.
- Equipment & Transportation: Finning International Inc. (TSX:FTT) and Toromont Industries Ltd. (TSX:TIH) could see increased demand for equipment, while railways Canadian National Railway Co. (TSX:CNR) and Canadian Pacific Kansas City Ltd. (TSX:CP) may handle increased freight.
Nvidia's Rollercoaster Week and Market Jitters
In other tech news, Nvidia Corp. (Nasdaq:NVDA) experienced a volatile week. The chipmaker initially saw its shares jump five per cent after reporting earnings that smashed sales estimates by over US$3 billion. However, those gains were quickly erased as fears of an AI market bubble resurfaced and concerns grew that the U.S. Federal Reserve might pause further interest rate cuts.
By the end of the week, Nvidia's stock was down more than four per cent and nearly 14 per cent below its October high. Despite this market nervousness, analyst sentiment remained strong. According to Bloomberg, 26 analysts raised their price targets for Nvidia by an average of 11 per cent following the earnings report, bringing the average 12-month target to US$250.26. The stock was trading around the US$180 level on Friday.
