In a remarkable feat, artificial intelligence frontrunner Nvidia has surpassed Microsoft to become the most valuable public company, propelling the S&P 500 to a fresh record high. The broad market index closed with a gain of 0.25% at 5,487.03, while the tech-heavy Nasdaq Composite inched up 0.03% to reach a record high of 17,862.23. The Dow Jones Industrial Average also rose by 0.15%, settling at 38,834.86.
Investors are keen to ride the wave of Nvidia’s success, along with other prominent tech companies. However, there is also a noticeable shift towards second-tier names in the market. Ken Mahoney, from Mahoney Asset Management, noted that money is not leaving the market, but there seems to be a rotation out of the current market leaders for this quarter.
Nvidia’s stock price surged by 3.5%, surpassing Microsoft in market value. This milestone comes after Nvidia achieved a market cap of over $3 trillion and overtook Apple in value earlier this month. The chipmaker’s shares have soared by 174% since the beginning of the year, as the enthusiasm for artificial intelligence continues to grow. In a show of solidarity, some semiconductor stocks also experienced gains, with Qualcomm and Taiwan Semiconductor rising by 2.2% and 1.4%, respectively. Micron Technology also saw a notable increase of 3.8%.
The semiconductor sector also benefited from declining Treasury yields, following a weaker-than-expected retail sales report. This development has sparked hopes for an economic slowdown and potential Federal Reserve rate cuts. Chris Zaccarelli, Chief Investment Officer at Independent Advisor Alliance, emphasized the importance of consumer spending for the continuation of the bull market. He expressed concerns that the retail sales report might indicate a material slowdown, which could hinder the market’s progress.