Intel emerged as one of the most overbought stocks this week after the semiconductor giant struck new partnerships with Google and Elon Musk’s TerraFab project. Major stock averages rose this week on hopes that the fragile ceasefire between the United States and Iran will hold. The tech-heavy Nasdaq Composite Index led the gains, rising 4.7%, followed by the S&P 500 and Dow Jones Industrial Average, rising 3.6% and 3%, respectively. However, investors invested more in certain stocks than others. CNBC Pro used a stock screening tool to identify these stocks based on their 14-day relative strength index (RSI). A stock with a 14-day RSI above 70 is considered overbought and a decline may be imminent. On the other hand, a reading below 30 indicates that the stock is oversold and could bounce back soon. The table below lists the most overbought stocks this week. Intel stock has soared nearly 25% this week, ending at an RSI of 75 as of midday Friday. Investors showed love for the stock in signs that the chipmaker may be starting to shed its old guard. Expanding on an existing partnership, Google announced a commitment to use multiple generations of Intel’s central processing units in its artificial intelligence data centers. “Their Xeon roadmap gives us confidence that we can continue to meet the performance and efficiency demands of growing workloads,” Amin Vahadat, chief technologist for AI infrastructure at Google, said in a statement Thursday. Meanwhile, Intel CEO Lip-Bu Tan posted on LinkedIn this week that Intel is helping Elon Musk’s new Terafab project, a Texas-based chip factory, design, manufacture and package custom chips for SpaceX, xAI and Tesla. Fellow chipmaker Broadcom also joins Intel on the RSI’s most overbought list at 71. Shares in Broadcom, which joined Google and Anthropic in agreeing to expand semiconductor deals, had risen 19% this week as of midday Friday. Broadcom expects to produce future versions of Google’s AI chips and expanded its Anthropic deal to give AI startups access to about 3.5 gigawatts worth of computing power powered by Google’s AI processors. Chip stocks soared this week as investors focused on semiconductor stocks instead of software, with the VanEck Semiconductor ETF (SMH) ending the week up 11%. Meanwhile, the week’s most oversold stocks included a number of software names. ServiceNow made the list with an RSI of 26. The software company was trading 19% lower this week as of midday Friday. On Thursday, UBS lowered its rating on ServiceNow from “buy” to “neutral,” saying it expected further downside due to the threat of AI disruption. “So far, our view is that ServiceNow is better positioned in this AI era compared to other application software companies… (but) given our weakening confidence in that view and the growing anecdotal evidence of budget pressure in non-AI app software, we plan to move to a neutral rating,” UBS analyst Karl Keilstedt wrote. Fellow software stock Salesforce is also on the list, with an RSI of 29, down 11% since the start of the week as of midday Friday. Investors appear to have put software stocks on fire this week, with the iShares Expanded Technology Software Sector ETF (IGV) ending the week down 7%. —CNBC’s Jordan Nove and Katie Tarasoff contributed to this report.
