NVIDIA at $198, AI Stocks Lead — But Is the Magnificent 7 Era Ending?
DAILYCRYPTOSTOCK.BLOGSPOT.COM · MAY 5, 2026
NVIDIA at $198, AI Stocks Lead — But Is the Magnificent 7 Era Ending?
DAILYCRYPTOSTOCK
DAILYCRYPTOSTOCK.BLOGSPOT.COM
May 5, 2026 · Tech Stocks · NASDAQ · Market Analysis
AI Is Still the Engine — But the Train Is Changing Direction
If you had invested in the stock market at the start of 2026, you’d be looking at some impressive gains. The S&P 500 is trading close to all-time highs, and the AI infrastructure boom is showing no signs of slowing down. But here’s the interesting thing — the stocks driving those gains are starting to look a little different. For the past two years, it was a simple story: buy NVIDIA, buy Apple, buy Microsoft, collect gains. But in May 2026, something is shifting.
NVIDIA: Still Dominant, But at a Crossroads
NVIDIA (NVDA) closed at $198.67 on May 4, 2026 — still near the upper end of its 52-week range of $110.82 to $216.83. That’s an 80% gain from its 52-week low, extraordinary for a company of its size. The bull case remains ironclad: NVIDIA controls over 75% of the AI chip market for data center training and inference.
JPMorgan recently raised its AI infrastructure capex estimate to $650 billion for 2026 — a 63% increase year-over-year. Amazon alone will account for $200 billion of that spending. Every dollar these hyperscalers spend on data centers means more NVIDIA chips sold. Mizuho reiterated NVIDIA as “outperform,” noting the company’s data center business is projected to grow at a 60% CAGR through 2028.
💡 Key Context: Anthropic — the AI company behind Claude — is reportedly planning a fundraising round at a $900 billion valuation. This signals that AI investment appetite in 2026 is absolutely not cooling off, and the picks-and-shovels play (NVIDIA) benefits accordingly.
The Magnificent 7: Still Leading, But Growth Is Slowing
The Magnificent 7 (Apple, Microsoft, Alphabet, Amazon, Meta, NVIDIA, Tesla) still accounts for about one-third of the S&P 500’s performance. But their earnings growth is expected to hit just 18% in 2026 — the slowest pace since 2022. Meanwhile, the other 493 companies in the S&P 500 are expected to grow earnings by 13%. That gap is narrowing fast, and when it narrows, paying 29x earnings for the Mag 7 becomes harder to justify.
Tesla and Apple: The Struggling Siblings
Tesla remains the most expensive Mag 7 member by valuation at nearly 200x estimated earnings — a multiple that requires near-perfect execution on robotaxis and robotics to justify. Apple is holding steady with Morgan Stanley maintaining an “overweight” rating, with revenue expected to grow 9% in fiscal 2026 — the fastest pace since 2021.
What This Means for Investors in May 2026
The stock market is not broken. AI spending is real, earnings are growing, and institutional confidence is intact. But the era of “just buy the Magnificent 7 and go to sleep” may be giving way to a more selective approach. Watch for opportunities in energy infrastructure, semiconductors beyond NVIDIA, and cloud-adjacent plays as the AI capex cycle matures.
For crypto investors: the correlation between Bitcoin and NASDAQ remains relevant. When tech does well, crypto tends to find support. The current tech strength is one tailwind keeping BTC above $80,000.
Frequently Asked Questions
Is NVIDIA stock still a good buy in 2026?
NVIDIA controls 75%+ of the AI chip market and faces $650B in 2026 AI infrastructure spending. Analysts remain largely bullish, but the stock’s run from lows has been significant. This is not financial advice — research thoroughly before investing.
What are the Magnificent 7 stocks?
Apple, Microsoft, Alphabet (Google), Amazon, Meta, NVIDIA, and Tesla — the seven mega-cap tech companies that have driven a significant portion of S&P 500 returns in recent years.
⚠ Disclaimer: This content is for informational purposes only and does not constitute financial or investment advice. Stock prices and market conditions change rapidly. Always do your own research and consult a professional advisor.