The Nasdaq and S&P 500 saw gains on Thursday following Nvidia’s impressive earnings report, which boosted confidence in the continued growth of the AI sector. Nvidia’s stock jumped over 7% in premarket trading to exceed $1,000 for the first time, as the company surpassed Wall Street’s earnings forecasts and raised its future projections, alleviating concerns about weakening AI demand. Other chipmakers and AI-related stocks also saw increases, with Dell and Super Micro Computer both rising around 6% and 5%, respectively. This positive momentum helped offset worries about rising interest rates that had caused a market dip the previous day.
Additionally, the release of May manufacturing and services PMI data later in the day was expected to provide more insight into the economy’s response to the Federal Reserve’s attempts to control inflation. Snowflake and News Corp. both experienced boosts in their stock prices, with Snowflake’s shares rising 4% thanks to an optimistic sales outlook. News Corp. signed a deal with Microsoft-backed OpenAI, which will provide ChatGPT access to content from The Wall Street Journal and other publications.
In an exclusive interview with Yahoo Finance, Nvidia CEO Jensen Huang addressed concerns about a slowdown in demand for the company’s chips, emphasizing the strong current demand for data centers and graphics processing units. This reassurance from Huang, along with Wall Street analysts’ positive reactions, contributed to Nvidia’s stock price increase and continued support from investors.
Overall, the market’s bullish sentiment towards AI-related companies, fueled by Nvidia’s strong performance and positive outlook, helped counterbalance apprehensions about interest rates and inflation. The tech-heavy Nasdaq and S&P 500 indices benefited from the AI rally, with hopes for continued growth in the sector driving investor optimism and market gains.
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