On Tuesday, the U.S. stock market witnessed a notable rally, with all three major indices closing at record highs. The Dow Jones Industrial Average increased by 0.34% to finish at 47,706.37 points, while the S&P 500 Index climbed 0.23% to reach 6,890.89 points. The Nasdaq Composite Index saw a robust gain of 0.8%, closing at 23,827.49 points.
A significant player in this upward trend was NVIDIA, the world’s largest company by market value, which surged 4.98% to close at $201.03, bringing its market capitalization to nearly $4.9 trillion. During the mid-day GTC conference, NVIDIA’s CEO Jensen Huang unveiled an ambitious vision for the role of artificial intelligence (AI) across various industries, highlighting multiple trending technological themes that have captured investor interest.
NVIDIA’s ascent positively influenced other semiconductor stocks, with Intel experiencing a 5.03% rise and Broadcom increasing by 3.02%. Additionally, Nokia saw a remarkable gain of 22.84% following NVIDIA’s announcement of a $1 billion investment aimed at accelerating AI-driven radio access network innovations and leading the transition from 5G to 6G technology.
In related news, Microsoft’s shares rose 1.98% to a record high, pushing its market capitalization past the $4 trillion mark. Earlier in the day, the tech giant announced a new agreement with OpenAI, which entails support for advancing OpenAI’s for-profit initiatives while indicating a diluted share conversion ratio of about 27%. Apple also adjusted to this positive sentiment, gaining 0.07% and reaching a new closing record, momentarily crossing the $4 trillion market cap during trading.
As the earnings reporting season approaches, major companies including Microsoft, Alphabet, Meta, Apple, and Amazon are set to disclose their financial results this week. Financial analysts like Mike Dickson from Horizon Investments expressed optimism, noting that the earnings season appears to have started on a strong note. However, he cautioned that equity valuations are historically high, and the market may have already received significant support from the Federal Reserve. Many investors are now looking forward to potential interest rate cuts as indicated by the CME Group’s “FedWatch” tool, suggesting a 99.9% probability for a 25-basis-point cut.
On international markets, the Nasdaq China Golden Dragon Index fell by 1.23%. Within this space, individual Chinese stocks showed varied performances; Pony AI surged 11.13%, while Bilibili and XPeng Motors increased by 5.37% and 1.39% respectively. However, several notable companies faced declines, with New Oriental Education and Technology Group dropping 3.35% and Alibaba down 1.52%.
Turning to company-specific news, NVIDIA recently introduced a cutting-edge quantum device named NVQLink designed to connect quantum processors with NVIDIA chips. This initiative aims to bridge quantum computing and GPU computing, linking various quantum computing companies and research labs. NVIDIA anticipates that its business growth will reach $500 billion over the next six quarters, pledging to deliver 20 million Blackwell Ruben graphics processing units, which are now “fully in production.”
In its agreement with OpenAI, Microsoft will see an additional $250 billion worth of Azure services purchased by OpenAI. This contract shifts the dynamics of their partnership as OpenAI can now co-develop products with other entities, although products reliant on APIs will remain exclusive to Azure.
Apple is looking to enhance its product line as well, planning to incorporate OLED technology into the displays of both its MacBook Air and iPad, potentially leading to price adjustments, notably a $100 increase for the iPad mini.
Lastly, Visa reported impressive fourth-quarter results, with net revenue reaching $10.7 billion—an 11% year-over-year growth that surpassed market expectations, driven by a significant rise in payment transaction volumes.
