Nvidia(US:NVDA) Hua Er Jie Jian Wen·2025-11-01 02:37Core Insights - The U.S. stock market is exhibiting two major contradictions: tech giants are driving indices to new highs, yet market breadth has narrowed to extreme levels, with U.S. stocks lagging behind global markets for 18 consecutive months [1][5]. Group 1: Market Performance - The Nasdaq index recorded a 5% increase for two consecutive months, but market concentration has reached historical extremes [1][6]. - On a recent Tuesday, the ratio of advancing to declining stocks in the S&P 500 hit the lowest level on record, indicating that large tech stocks are dominating while the other 493 components remain stagnant [1][8]. - Despite the strong performance of U.S. tech giants, the overall U.S. market has underperformed compared to global markets, failing to generate excess returns over the past 18 months [5][6]. Group 2: Tech Giants and Investment Trends - The seven major tech companies (Mag-7) significantly outperformed the remaining S&P 500 components, which remained nearly flat during the same period [6]. - Meta is facing investor skepticism regarding its return on investment, yet its $125 billion bond issuance received record demand, indicating its continued investment capability [7]. - Following the third-quarter earnings report, the capital expenditure plans for the seven giants may be adjusted upward by $60 billion for 2026, with Nvidia becoming the first company to surpass a $5 trillion market cap [7][9]. Group 3: Global Market Dynamics - The global market breadth is impressive, supported by valuation and positioning, suggesting a continuation of this trend [3][12]. - Significant changes are occurring in the European market, with companies like Airbus and Thales merging satellite businesses, indicating a shift in traditional industries towards AI efficiency [10]. - The Asian market is also showing positive trends, with expectations for earnings per share and overall market performance supported by the dollar's trajectory and an upward revision of China's GDP forecast [12].