JP Morgan Raises 2027 Data Center CAPEX to +70% yoy growth from +50% prior “Given the latest data center capex forecast for the top four U.S. CSPs, we remain bullish on coverage companies that directly support AI infrastructure demand, particularly across networking. In our view, networking growth should track even stronger, given its increasing mix of spend and its role as a gating factor for high-end compute performance” $CRDO $LITE $COHR

UBS: “For C2027 we anticipate ~50GW of compute shipments (requiring ~57GW of powered data center including PUE factor) against current visibility for ~38GW of powered shell when excluding early-stage power plant projects. In C2028, this gap widens further with semis shipments of ~68GW (requiring ~76GW of powered shell) against visibility of ~50GW. On the surface, this is worrisome, but we do feel it is still possible to bridge the gap in both years.” $AMD $AVGO $NVDA $CIFR $WULF

For those not familiar with the industry dynamics/vernacular, let me explain what the 🐑 is saying here about current selling pressure. The market-neutral/pod world These are multi-strategy firms that split their money among lots of small teams (“pods”). Many of those teams try to stay market-neutral: they own some stocks and short others in roughly equal size so they’re not just betting that the whole market goes up. They live and die by risk limits. When volatility jumps or their models say a sector is too risky, they cut positions fast - often all at once. Because they use a lot of leverage, even a modest risk reduction can mean a lot of selling. Sector specialist SMAs These are separately managed accounts (private portfolios run for one big client), in this case for biotech. The manager isn’t running a big shared fund; they’re running a custom account for that one client. That setup can be convenient for the client, but it also makes the money less “sticky.” If the client gets nervous, or a lender looking at the account tightens the screws, the manager can be forced to sell quickly. When a bunch of these specialist accounts de-risk at the same time, you get a wave of selling in the same names. In short; this looks more like a mechanical, risk-management selloff from those two groups than a fundamental story.