The $1.4 trillion fund’s holdings in tech companies witnessed a jump of nearly 39 percent in the period with Apple, Microsoft and Nvidia contributing the most to drive the fun’s 10 percent overall return.
Norway’s $1.4-trillion sovereign wealth fund received a massive boost with artificial intelligence driving the tech industry and consequently bringing back technology stocks on track in the first six months of the year.
The Norwegian fund’s holdings in tech companies spiked nearly 39 percent in this period with Apple, Microsoft and Nvidia contributing the most to drive the fund’s 10 percent overall return.
The Sovereign Wealth Fund
The Norwegian sovereign wealth fund responsible for managing the financial assets generated from Norway’s oil and gas resources experienced nearly 14 percent increase from its stock holdings within six months up to June 30. Simultaneously, its fixed income assets yielded slightly upwards of 2 percent returns.
However, the firm’s return witnessed a 4.6 percent decrease in assets on unlisted real estate investments as well as a 6.5 percent loss on investments in the unlisted renewable energy investments.
As the first half of the year concluded, the fund was being valued at 15.3 billion kroner ($1.4 trillion), 71 percent of which was derived from equities, according to Reuters.
This fund, amounting to almost three times of Norway’s economy currently owns about 1.5 percent of the world’s overall stocks. Between 1998 and June 2023, it generated an annual return of just shy of 6 percent.
However, in the previous year, the fund underwent a loss of 14 percent, one that stands to be the second worst return in its history, right after a 23% loss at the peak of the 2008 crash.
Norway Sovereign wealth fund’s largest equity holdings (June 2023)
Chief Executive Officer of Norges Bank Investment Management Nicolai Tangen lauded the stock market as “very strong in the first half of the year, following a weak year in 2022,” adding that “especially technology stocks have seen significant growth, largely driven by the increased demand for new solutions in artificial intelligence,” reported Bloomberg.
Earlier this month, Apple’s Chief Executive Officer Tim Cook stated that the company has been working on AI, as well as generative AI. “We are going to continue investing and innovating and responsibly advancing our products with these technologies to help enrich people’s lives,” he added, reported TOI.
“These are the first steps we are taking to infuse next-gen AI and data with productivity tools like Dynamics 365 Field Service to help address the challenge of repetitive tasks and burnout. The new AI-powered Copilots use generative AI to automate the repetitive and taxing digital overhead that burdens frontline workers,” stated Charles Lamanna, CVP of business applications and platform management told VentureBeat when the company unveiled next-gen AI solutions in order to boost frontline productivity.
“This is our seventh year as an AI-first company, and we intuitively know how to incorporate AI into our products,” stated CEO Sundar Pichai on an earnings call while the company reported a strong second quarter as the revenue rose up by 7 percent to $74.6 billion amidst increase in AI efforts.
Norway’s sovereign wealth fund mentioned in a separate statement that they support the development of a comprehensive and cohesive regulatory framework for A.I. that facilitates safe innovation and mitigation of adverse impacts.
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