Nvidia vs. Sandisk vs. Utilities?
What a week!
Nvidia (NVDA) flopped after earnings, OpenAI picked up $110 billion in fresh funding, and PPI came in hot.
So let's look at the 5 things you need to know right now.
1. Nvidia = Buy on Valuation?
Nvidia (NVDA) delivered another solid across-the-board beat and strong guidance on Wednesday.
And for the third straight quarter, it sold off the next day. I'm long, so of course I'm aggravated.
So what's the problem?
Everyone's wondering how long the AI capex spending boom can last.
Because companies like Oracle (ORCL) and Meta (META) are burning downright absurd levels of cash flow.
However, there may be hope for the bulls.
Nvidia's valuation has compressed to 22 times forward earnings.
That's right around where the stock bottomed in November 2023 and April 2025.
Meanwhile, Nvidia is expected to grow earnings by 73% this year.
If this was 1985, Peter Lynch would be loading up for the Magellan fund.
But while tech leaders like Nvidia and Microsoft (MSFT) sag, you know what's not struggling.
2. The Electric Mystery Machine Are In Secret Bull Market Mode
SPY is down in 2026, but the State Street Utilities Select Sector SPDR ETF (XLU) just keeps grinding up:
I highlighted this secret bull market on February 13.
Why are utilities booming?
Rates are falling.
And traders could be rotating into utilities in fear of an economic mess.
Plus, AI is driving increased electricity demand.
And Anthropic said it will fit the bill for infrastructure upgrades and consumers' higher electric bills.
Why didn't you see this on financial TV?
They're talking about Nvidia.
3. SanDisk May Be Setting Up Beautifully
I'm long SanDisk (SNDK).
I even declared myself the Captain of Team SanDisk. Not that I'm buying it here.
It's the #1 stock in the S&P 500 this year, and right now it's hugging the 20 day moving average:
Could it be basing for a breakout?
We talked about it on this week's live stream:
4. Cybersecurity Is Less Awful Than Regular Old Software
We all know software has been a mess, with the iShares Expanded Tech-Software Sector ETF (IGV) down 23% year-to-date.
But cybersecurity is holding in less bad.
The Amplify Cybersecurity ETF (HACK) is “only” down 10% YTD.
And security leader CrowdStrike (CRWD) reports on Tuesday.
This is a pivotal report.
The stock recently came under pressure when Anthropic launched Claude Code Security.
If CrowdStrike says AI is not a problem for them (or an opportunity), it could add some upside fuel.
Interestingly, CrowdStrike describes itself as “The Agentic Security Platform. Unified and built to secure the AI revolution.”
5. The Mood Is Still Sour
It's hard to argue that investors and traders are too optimistic.
The AAII Sentiment Survey shows that just 33.2% of investors are bullish.
This is below the 37.5% long-term average.
And it's well below the 49.5% reading notched on January 14.
Also: the CBOE equity put-call ratio averaged 0.61 this week, which is in the neighborhood of neutral.
This is all good news.
Because extremes in bullish sentiment can signal complacency and mark tops.
And we are nowhere close to extreme bullish sentiment.
Which makes sense given how tricky this market is.
Back on February 12, we asked our Twitter following if 2026 has been harder than 2025.
80% said yes.
That says a lot about how frustrating this market's endless grind is.