Divergent Performance of Large-cap U.S. Tech Stocks: Analysis of Catalysts Driving NVIDIA's Countertrend Rally

Based on the latest market data and news, I will provide an in-depth analysis of the divergent performance of large-cap U.S. tech stocks, focusing on interpreting the catalysts driving NVIDIA’s countertrend rally and the internal rotation trend within the tech sector.

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According to the market data provided, U.S. stock pre-market trading on January 7, 2026 showed a clear divergent pattern:

Ticker	Company Name	Change %
NVDA	NVIDIA	+0.62%
TSLA	Tesla	+0.26%
NFLX	Netflix	+0.24%
META	Meta	-0.40%
GOOGL	Google	-0.37%
AAPL	Apple	-0.20%
MSFT	Microsoft	-0.13%
AMZN	Amazon	-0.10%

From the overall market perspective[0], the tech sector performed relatively steadily on the day, rising 0.90%, outperforming the energy sector (-1.77%) and utilities sector (-2.15%), while the communication services sector (-0.10%) declined[0].

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are the key catalyst driving NVIDIA’s rally. Caterpillar announced on January 7, 2026 that it is expanding its partnership with NVIDIA to deploy AI and robotics technology in the construction machinery sector[1]. This partnership marks NVIDIA’s AI chips expanding application scenarios from traditional cloud computing to real economy sectors such as heavy industry, demonstrating the strong scalability of its AI ecosystem.

NVIDIA announced at CES 2026 that it will expand its GeForce Now cloud gaming service to Amazon Fire TV devices and Linux platforms, supporting 4K ray tracing[2]. This strategic move expands cloud gaming from traditional gaming devices to a broader consumer electronics field, which is expected to open up new growth channels. The service has already accumulated over 25 million members, and this expansion will further expand its user base and subscription revenue.

According to industry data, NVIDIA controlled

in 2025, with its closest competitors AMD and Intel accounting for only a small proportion[3]. This near-monopoly market position provides NVIDIA with strong pricing power and customer stickiness, ensuring sustained growth in its data center and AI chip businesses.

Looking at stock price data[0], NVIDIA has risen from a low of $86.62 to $189.97 over the past 343 trading days, representing a gain of 119.53%. Its 20-day moving average is $183.66, and the 50-day moving average is $186.84, indicating that the short-term technical pattern remains intact. The stock rose approximately 39% in 2025, outperforming the broader market[4].

Despite facing the short-term negative news of China pausing purchases of H200 chips[5], global demand for AI chips remains strong. Tech companies such as xAI are purchasing NVIDIA GPUs on a large scale, and Valor Equity Partners has raised $5.4 billion specifically for purchasing NVIDIA chips[6], indicating that the AI infrastructure construction cycle is far from over.

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Meta is facing a review by the Chinese government over its $2 billion acquisition of Manus AI[7]. Chinese regulators are assessing whether the transaction involves violations of technology export controls, which casts a shadow over the prospects of Meta’s business in China. In addition, although demand for Meta’s Ray-Ban smart glasses is strong, the company has suspended its international expansion plans, reflecting challenges in supply chains and regulation.

Although Evercore ISI reaffirmed Apple as its top pick in the hardware sector[8], investors are focused on the upcoming launch of the iPhone 17e and the delayed upgrade of AI Siri. According to reports, the major update to Siri may not arrive until March 2026, which may fail to meet the market’s high expectations for Apple’s AI strategy.

Microsoft has aggressively promoted AI features in Windows 11, but market feedback has been poor. A user created a video criticizing Microsoft’s AI features as “Microslop” (junk), mocking that its AI search function does not work properly[9]. In addition, rumors that Microsoft may lay off 22,000 employees to fund its AI infrastructure transformation have also heightened market concerns[10].

Google and Amazon continue to face increasing competitive pressure in the AI field, requiring continuous investment to catch up with NVIDIA’s leading edge in the chip sector, while also facing challenges from startups such as OpenAI in generative AI applications.

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The current market shows a clear trend of

. Investors prefer AI infrastructure companies (such as NVIDIA) with over software and application companies. This rotation reflects:

• Stronger revenue predictability for hardware companies
  : Demand for GPU chips is directly driven by capital expenditures of major cloud service providers and AI companies
• Business model verification pressure on software companies
  : The commercialization path of AI software is still unclear
• Rising regulatory risk premium
  : Companies such as Meta and Apple face a more stringent regulatory environment

Within the semiconductor sector,

(NVIDIA, Broadcom) have significantly outperformed (Intel, some businesses of AMD). NVIDIA continues to command a market premium due to its monopoly position in data center AI accelerators.

Notably, the capital expenditure cycle of cloud computing giants remains the core driver for NVIDIA. The demand for AI infrastructure construction from Google Cloud, AWS, and Azure provides NVIDIA with a stable revenue source, forming a positive cycle of

.

After sharp rallies in 2024-2025, some tech stocks (especially software companies) are facing valuation pressure. Investors are beginning to focus more on profit confirmation and cash flow generation capabilities rather than just narrative growth. NVIDIA’s quarterly revenue growth of approximately 66% (year-over-year) and 75% gross margin demonstrate that its business model has been fully validated[4].

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• Subsequent announcements and partnership releases from CES 2026
• Upcoming earnings season (especially earnings reports of large-cap tech companies in late January)
• Policy developments related to artificial intelligence

• Uncertainty in China’s regulatory policies (affecting Meta and NVIDIA’s businesses in China)
• Impact of Federal Reserve interest rate policies on valuations of growth stocks
• Risk of AI valuation bubble (some AI companies’ rallies have decoupled from fundamentals)

• Overweight
  : AI chip infrastructure (NVIDIA, Broadcom), data center REITs
• Neutral
  : Enterprise software (focus on companies with actual revenue growth)
• Cautious
  : Social media (rising regulatory risk premium), consumer hardware (cyclical demand)

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NVIDIA’s countertrend rally is not accidental, but the result of multiple catalysts converging:

demonstrate the broad applicability of its technology, provides a strong competitive moat, opens up a new growth narrative, and ensures long-term growth momentum.

The divergent performance of the tech sector indeed signals

: shifting from pursuing growth narratives to confirming profits, from software applications to hardware infrastructure, from high-risk concepts to companies with actual revenue and cash flow. This rotation may continue in early 2026 until software and application companies can prove the feasibility of their AI commercialization.

For investors, understanding this structural change helps with more precise allocation within the tech sector, enabling them to enjoy the dividends of the AI revolution while effectively managing risks.

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[1] PRNewswire - Caterpillar Teams with NVIDIA to Revolutionize Heavy Industry with AI and Robotics (https://www.prnewswire.com/news-releases/caterpillar-teams-with-nvidia-to-revolutionize-heavy-industry-with-physical-ai-and-robotics-302655427.html)

[2] TechCrunch - NVIDIA Expands GeForce Now to Fire TV and Linux at CES 2026 (https://techcrunch.com/2026/01/07/caterpillar-taps-nvidia-to-bring-ai-to-its-construction-equipment/)

[3] Carbon Credits - NVIDIA Controls 92% of the GPU Market in 2025 (https://carboncredits.com/nvidia-controls-92-of-the-gpu-market-in-2025-and-reveals-next-gen-ai-supercomputer/)

[4] Yahoo Finance - NVIDIA Soars 39% in 2025 and Its 2026 Outlook (https://finance.yahoo.com/news/nvidia-soars-39-2025-stock-123200959.html)

[5] GuruFocus - NVIDIA (NVDA) Faces Setback as China Pauses H200 AI Chip Purchases (https://www.gurufocus.com/news/4100036/nvidia-nvda-faces-setback-as-china-pauses-h200-ai-chip-purchases)

[6] Data Center Dynamics - Valor Equity Partners Raises $5.4B to Buy NVIDIA GPUs for xAI (https://www.datacenterdynamics.com/en/news/valor-equity-partners-raises-54bn-to-buy-nvidia-gpus-for-xai/)

[7] Blockonomi - China Reviews Meta’s $2B Manus AI Deal Over Possible Export Control Breach (https://blockonomi.com/china-reviews-metas-2b-manus-ai-deal-over-possible-export-control-breach/)

[8] GuruFocus - Evercore ISI Reaffirms Apple as Top Tech Pick Ahead of Key iPhone Cycle (https://www.gurufocus.com/news/4099776/aapl-evercore-calls-apple-top-tech-pick-ahead-of-key-iphone-cycle)

[9] Futurism - Video Criticizes Microsoft’s AI Features for Ruining Windows (https://futurism.com/artificial-intelligence/video-microsoft-ruining-windows-ai)

[10] Neowin - Rumours Suggest Microsoft May Cut Up to 22,000 Jobs in Early 2026 (https://www.neowin.net/news/rumours-suggest-microsoft-may-cut-up-to-22000-jobs-in-early-2026/)