A strong advertising market may be starting to feel the pressure from geopolitical risks erupting aboard and a higher-for-longer interest rate environment. The concerns around advertising are typical for an industry often tied to consumer spending, and one that’s suffered from Apple iOS privacy changes that reduced the ability to target specific audiences . But comments from some major technology players last week led to increasing questions that some investors have struggled to shake off. Meta Platforms Chief Financial Officer Susan Li warned that the volatile geopolitical landscape, including war between Israel and Hamas, could create some advertising uncertainty into the new year . Snap also said it saw some pauses in “brand-oriented advertising campaigns” at the start of the Mideast war. META 5D mountain Meta shares in recent trading sessions That concern added to declines in other ad-focused technology names, with Alphabet dropping nearly 10%. Snap and Meta finished last week down 1.5% and 3.9%, while ad-tech players such as the Trade Desk slumped about 10%. To be sure, some analysts and investors say fears of a hit to advertising may be overblown – especially if the Mideast crisis doesn’t escalate. And companies are still showing signs of advertising strength. Ad revenue rose 9.5% at Alphabet from a year ago, and the Google parent saw even greater gains within its YouTube business. Snap reported revenue growth of 5%, while revenue at Meta jumped more than 23%. Alphabet’s chief business officer also hinted at the ways artificial intelligence integration is helping advertisers reach new audiences at low prices. But if advertising shows signs of stability, the murky geopolitical backdrop — and unclear interest rate environment from the Federal Reserve — is enough to keep some investors on the sidelines in the near term. GOOGL 1M mountain Alphabet shares over the last month “The setup is that investors aren’t buying the strength in the ad market,” said Deepwater Asset Management’s Gene Munster. “There is reason for concern.” Those fears may be priced in for investors such as Munster with a longer-term time horizon, but sufficient enough to contribute to some shorter term volatility and potential softness if consumer spending eases. A ramp up in political advertising in 2024 ahead of the presidential and Congressional elections could boost advertising spending in the new year for companies such as Alphabet, said Laffer Tengler Investments’ CEO Nancy Tengler. However, at its current valuation, Alphabet looks too expensive for an advertising company. Instead, Tengler favors companies such as Microsoft , which offers some, but less concentrated, exposure to advertising. Tengler, whose firm owns some shares of Alphabet, wants more clarity from management beyond advertising to consider building the position further. That includes more insight into the recent warnings of a cloud slowdown and Alphabet’s generative artificial intelligence plans, she said. At present, Tengler favors exposure to cybersecurity companies and those with resilient earnings in a slowdown rather than communication services. Technology investor Paul Meeks is also shying away from the most popular advertising players — and big technology as a whole — until he sees a better setup for interest rates. The macro pressures and potential extension of the war in Israel, coupled with the higher-for-longer rate environment, should fuel more volatility and choppy trading into year end, he added. “That’s a pretty powerful one-two punch with the higher-for-longer thesis with rates in the States and now you got yet another geopolitical issue,” Meeks said, noting that technology exposure is likely greater in Israel than Ukraine. But any pockets of weakness could offer an opportunity for longer-term investors to step in, noted Roth MKM’s Rohit Kulkarni. One silver lining for big tech in a slowing ad market is that advertisers tend to first cut spending to smaller players. “If the advertising pie is not growing at a rapid rate, stops growing, or even starts to shrink, larger companies benefit, and their share of wallet grows,” Kulkarni explained. “Once we are out of this environment, the smaller companies start to benefit.” — CNBC’s Michael Bloom contributed reporting