The Week on Wall Street
Stocks vaulted to new heights last week on the back of an artificial intelligence (AI) semiconductor company, marking investors’ belief that AI has the potential to transform the U.S. economy.
Stocks Rally to Record Highs
Stocks traded in a fairly tight range for the first half of the short week, yawning at the lack of economic data while awaiting earnings results from one key company that creates chips that power the artificial intelligence operations of many firms.
A strong Q4 corporate report and long-term message from Nvidia Corp. pushed the S&P 500 and Nasdaq to new closing highs on Thursday.
Nvidia’s market cap rose by $277 billion on the news, pushing it to a $2 trillion valuation. To put that in perspective, Nvidia’s market cap is now roughly the same size as Canada’s economy. Its 16% gain on Thursday was the largest one-day market cap increase by any U.S. company.1,2
Remember, companies mentioned are for illustrative purposes only. It should not be considered a solicitation for the purchase or sale of any company connected with AI.
Inflection Point?
Nvidia’s seismic increase in market cap gave investors pause for reflection, wondering whether this marked an inflection point for artificial intelligence.
The main story that investors took away was that, because of its market dominance as the leading global provider of AI computer chips, Nvidia served as a proxy for AI. Some of the world’s most influential companies rely on Nvidia technology to power their own AI initiatives. Investors appear to have concluded that AI’s impact may just be starting, and anticipate it will be a driving economic force in 2024 and beyond.3,4
Weekly Riddle
Kristi and David live at opposite ends of a metro area but attend the same college. David left for campus 30 minutes before Kristi, and they met at a coffee house. Who was closer to campus when they met?
Last week’s riddle: What can explode slowly, with no smoke or flame?
Answer: A population.
John Dombroski Jr. may be reached at (480) 991-1055 or [email protected]
www.grandcanyonplanning.com
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