BlockBeats News, July 23rd, Bank of America Research stated in its latest report that with NVIDIA launching the Vera CPU architecture and engaging in more direct competition with AMD on the next-generation AI server platform, the potential market size of the server CPU is expected to reach $170 billion by 2030, about four times the current level. Bank of America maintains its buy rating on NVIDIA with a $350 price target, believing that the core of this round of competition has shifted from single-chip performance to how AI agent workloads should be measured: whether to complete a single agent task faster or to host more agents in the same rack.

At the time of this assessment, AI stocks were in a phase of rapid turnover. The Philadelphia Semiconductor Index had previously fallen more than 20% from its high, entering a technical bear market zone, but chip stocks subsequently rebounded. On Tuesday, supported by Micron and NVIDIA, the US stock market rose, with the Nasdaq up 1.3%; by Wednesday, rising oil prices and higher US bond yields suppressed risk appetite, causing the S&P 500 to slip slightly by 0.1% and the Nasdaq to fall by 0.6%, with AI stock volatility continuing to drag down the overall market.

Fund flows also showed a similar differentiation. Bank of America's client fund flow report showed that clients have been net buyers of US stocks for the third consecutive week, but the buying came mainly from retail investors and ETFs. Last week, clients bought $3.4 billion in stock ETFs while selling $3.1 billion in individual stocks; retail investors recorded the largest weekly buy since May 2025, institutional buying also remained positive for the third consecutive week but was entirely driven by ETFs. Hedge funds, on the other hand, sold stocks for the second consecutive week.

At the sector level, the technology sector saw outflows for the first time in three weeks, while communication services saw outflows for the third consecutive week; funds shifted to consumer discretionary, financials, and energy. Small and micro-cap stocks received significant buying interest, with the related four-week rolling average inflow hitting a new high since Bank of America began tracking.

Bank of America's long-term outlook for the server CPU market continues to support NVIDIA, AMD, and the demand narrative for AI infrastructure; client fund flows, on the other hand, serve as a reminder that the current trading environment has shifted from "buying all AI winners" to "screening companies that can demonstrate orders, profit margins, and cash flow."