The Most Fundamental Rally Ever Is Breaking with Fundamentals

The semiconductor rally has outpaced fundamental earnings revisions, with the GS AI basket up 42% YTD. Technical weakness in Nvidia (NVDA) suggests potential for a broader correction across the AI sector.

Key Takeaways

• 1.The semiconductor rally has significantly overshot near-term earnings-per-share (EPS) revisions.
• 2.Artificial Intelligence (AI) stocks are demonstrating extreme outperformance compared to the broader S&P 500 market.
• 3.Nvidia (NVDA) is showing signs of technical strain, testing the lower end of its trend channel.

Table of Contents

• Semis overshooting fundamentals
• Not normal
• The General

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