Nvidia crowding is falling sharply - UBS
STOXX 600 up 0.5%
Eyes on U.S. CPI
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NVIDIA CROWDING IS FALLING SHARPLY - UBS
Tech bulls are gearing up for the next round of earnings releases from the AI darlings, starting from ASML ASML.AS in Europe next week and culminating with Nvidia NVDA.O at the end of August.
Markets are showing unshaken optimism over the theme, with the Philadelphia semiconductor index .SOX bouncing from one record to the next.
But behind the scenes, less bullish signals are emerging.
A machine learning model set up by Swiss bank UBS has recently detected a sharp decline in positioning over the semiconductor names with Nvidia leading the sell-off. That highlights a shift from AI enablers to AI beneficiaries.
"While this investor positioning shift (primarily in prime brokerage data) is validated by our US analyst, Tim Arcuri, the share price remains near highs and is currently rebounding," write UBS strategists led by Gerry Fowler in note this week.
"However, the crowding data shows that the selling in AI related semis and software names has been at the same time that AI related cap goods, and utilities stock crowding has been rising," they added.
Have a look at the UBS chart below:
(Danilo Masoni)
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THURSDAY'S OTHER LIVE MARKETS POSTS:
EUROPE EDGES HIGHER BEFORE US CPI TEST CLICK HERE
STOCK FUTURES HINT AT FURTHER RECOVERY BEFORE U.S. CPI CLICK HERE
COUNTDOWN TO CPI CLICK HERE
Nvidia blog https://tmsnrt.rs/4bDfh1p
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