Nvidia’s staggering stock run carried it to the market’s mountaintop on Tuesday, as it became the most valuable company on Wall Street. The chipmaker’s shares rose 3.5%, lifting its total market value further above $3 trillion and grabbing the top spot from Microsoft, which had been trading the crown back and forth with Apple.
Nvidia’s ascent is driven by the wave of artificial intelligence (AI), with its chips playing a crucial role in developing the technology. The company’s revenue routinely triples every quarter, and its profit is skyrocketing at even more breathtaking rates. Nvidia’s stock is up nearly 174% this year and has been responsible for nearly a third of the S&P 500’s entire gain through May.
Stock Indexes Edge Up to More Records
Meanwhile, stock indexes ticked to more records following the latest signal that the U.S. economy’s growth may be slowing without cratering. The S&P 500 added 0.3% to set an all-time high for the 31st time this year, while the Nasdaq composite edged up by less than 0.1% to set its own record. The Dow Jones Industrial Average added 56 points, or 0.1%.
Treasury Yields Fall After Retail Sales Data
Stocks broadly got a lift from easing yields in the bond market. Treasury yields fell after a report showed sales at U.S. retailers returned to growth last month but remained below economists’ expectations. This could be an encouraging signal for the Federal Reserve, which is trying to slow the economy just enough through high interest rates to get inflation under control without triggering a painful recession.
Mixed Corporate News
In corporate news, homebuilder Lennar fell 5% after citing “challenged consumer sentiment” and swings in interest rates as challenges. Electric-vehicle maker Fisker more than halved to 2 cents after filing for Chapter 11 bankruptcy protection. On the winning side, La-Z-Boy jumped 19.4% after reporting stronger profit and revenue than expected, and Silk Road Medical surged 24% after agreeing to be acquired by Boston Scientific for roughly $1.26 billion.
Global Markets Recover
In stock markets abroad, indexes continued to recover in Europe following last week’s rout, with France’s CAC 40 rising 0.8% for a second straight gain. In Asia, Japan’s Nikkei 225 rose 1%, and heavyweight Toyota Motor climbed after its shareholders rejected a proposal to force the automaker’s chairman to leave his post.
As Nvidia’s star continues to rise and stock indexes reach new heights, investors will closely monitor the U.S. economy’s growth trajectory and the Federal Reserve’s interest rate decisions in the coming months.
AP
