HSBC Holdings Plc upgraded Apple Inc. to "buy" on Friday, reflecting growing Wall Street optimism about the iPhone maker's prospects in the artificial intelligence market.

Analyst Frank Eu highlighted Apple's potential in "agentic AI," a sophisticated form of artificial intelligence, and expressed confidence in the company's hardware product pipeline. Eu believes that Apple's unique position, with its integrated hardware, software, and services, will allow it to capture a significant share of the burgeoning AI market.

The upgrade comes as many AI-related trades have experienced volatility. HSBC's positive outlook on Apple suggests that investors are looking for more stable and established companies to capitalize on the AI trend. The firm anticipates that Apple's upcoming product cycles, potentially including new iPhone models and other devices, will be strong catalysts for growth. Eu specifically cited $210 as their price target for Apple shares.