Schwab Strategist Flags Wall Street's Growth Is Concentrated in Two Firms

Nvidia (NVDA) and Micron (MU) will drive a third of S&P 500 2026 earnings growth, Schwab's Liz Ann Sonders said. Bitcoin (BTC) broke above $80,000 the same day.

The chipmaker's earnings land Wednesday, a report Wall Street is treating as a verdict on the entire AI trade. Sonders called the resulting rotation into concentrated winners and away from crowded positions the market's defining dynamic.

Nvidia and Micron's Earnings Concentration

Sonders is chief investment strategist at the Schwab Center for Financial Research. On this week's "Closing Bell," she broke down how concentrated 2026 earnings growth has become.

Nvidia alone accounts for 18% of the S&P 500's expected year-over-year earnings growth, she said. Micron's AI memory chips add another 14 percentage points.

"I think rotation in and of itself is the new momentum trade."

Liz Ann Sonders, CNBC

Nvidia's earnings report arrives after seven straight losing sessions, even as prediction markets price in a near-certain beat. Some earlier analysis of the setup pointed to positioning and options flow, not fundamentals, as the driver of that mismatch.

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