This week, the market witnessed a rare event: Apple (AAPL) briefly overtook Nvidia (NVDA) in market capitalization, becoming the world's most valuable company. At the start of Friday's session, AAPL's market cap reached $4.92 trillion compared to NVDA's $4.86 trillion. However, the lead was short-lived — by the main trading session, Nvidia had reclaimed the top spot with a valuation of $5.02 trillion versus Apple's $4.89 trillion. Nevertheless, the gap between the giants has narrowed to a minimum — just around $130 billion.
The key driver of this surge is the divergent stock performance. Apple shares soared 1.76%, hitting an all-time high of $333.26, while Nvidia lost 2.40%, falling to $207.40. Over the past week, AAPL has gained more than 7%, whereas NVDA has lost nearly 4% over the month amid profit-taking by investors following a rapid rally.
This shift reflects a broader trend: investors are rotating from the AI sector into defensive assets. On the Nasdaq 100 heat map, Apple is one of the few mega-cap stocks in the green. The entire chip sector is under pressure: Alphabet fell 4.44%, Broadcom dropped 5.03%, and AMD declined 5.33%. The sell-off in AI stocks, which began in early July, continues.
Different Growth Drivers
Apple and Nvidia are betting on different engines. Apple relies on strong demand for the iPhone 17 and record-breaking performance from its services division, which generated $30.98 billion last quarter. Additionally, amid a shortage of AI memory, buyers have shifted to the premium segment, boosting demand for flagship devices.
Nvidia, on the other hand, continues to accelerate its pace: quarterly revenue reached $81.6 billion — 85.2% higher than a year ago. The data center segment grew 199% thanks to major players expanding their AI capabilities. The Blackwell 300 platform is gaining momentum, and TSMC has raised its forecasts, indicating a steady flow of orders for AI chips. There are no signs of a decline in fundamental demand — the current correction in NVDA is purely profit-taking after historic growth.
Apple's July 30 Report — A Key Moment
The next trigger for the market is Apple's report on July 30. Nvidia will report only on August 26, so Apple will have a full month to shape the information narrative. Analysts will focus on services growth, revenue from China ($25.53 billion last quarter), and early signals about the iPhone 18. On Polymarket, the probability of an iPhone 18 announcement this year is estimated at 96%.
The companies' valuations present an interesting choice for investors. Nvidia trades at roughly 22 times forward earnings, with a PEG ratio of 0.6 and a target of $91 billion in quarterly revenue. Gross margins remain around 75% — significantly higher than Apple's approximately 49%. Meanwhile, Apple commands a multiple closer to 32, justified by a streak of eight quarters of earnings per share growth, a new $100 billion buyback, and a $30 billion deal with Broadcom that strengthens its position in the chip segment.
Technical Outlook
On the daily chart, AAPL updated all-time highs on Thursday and Friday, with the latest peak recorded at $334.68. The price has been rising almost without interruption since late June. The key resistance level of $315 was breached on Thursday — this level had capped gains in May and mid-July, and it could now act as support during potential pullbacks.
The upward move began after a bounce from the $275-280 zone on June 26. The daily RSI has risen above 70, indicating a clear dominance of bulls, although such levels can signal a local correction.
My Comment: The market situation is a classic example of capital flowing from the overheated AI sector into more defensive assets. Apple benefits from diversification and a stable services business, but Nvidia should not be discounted: its fundamentals remain exceptionally strong. Apple's report on July 30 will be a litmus test — if services and China results are solid, AAPL could cement its leadership. If weaknesses emerge, Nvidia will have a chance to surge ahead again before its August report.