The S&P 500 reached a new milestone on Wednesday, surpassing 5,600 for the first time, driven by a significant surge in semiconductor stocks. The broad market index soared by 1.02%, closing at 5,633.91, marking its seventh consecutive day of gains. Simultaneously, the Nasdaq Composite also achieved an all-time high, rising by 1.18% and ending at 18,647.45. This marked the 37th record close for the S&P 500 in 2024 and the 27th for the tech-heavy Nasdaq. The Dow Jones Industrial Average also experienced a positive trend, adding 429.39 points or 1.09%, to close at 39,721.36.
The session witnessed chip stocks emerging as the primary winners. Taiwan Semiconductor saw a 3.5% increase after its revenue from April to June exceeded Wall Street estimates. Other chip companies, such as Qualcomm and Broadcom, also experienced slight gains of 0.8% and 0.7%, respectively. Nvidia, a prominent player in the field of artificial intelligence, climbed by 2.7%.
Investors eagerly await the release of fresh inflation figures on Thursday, with the June consumer price index report. These data points follow comments made by Federal Reserve Chair Jerome Powell on Tuesday and Wednesday, which have fueled hopes among investors for a rate cut in the second half of the year. Scott Welch, the chief investment officer at Certuity, noted that while some aspects of the market may appear overvalued, there is currently no indication that earnings from megacap technology companies cannot support their valuations. Welch also highlighted the concentration of market capitalization within a small number of stocks, emphasizing the potential amplified effect of any slippage.