The American stock market closed Thursday night at a record high, thanks to strong results from Nvidia Corporation as well as a forecast for huge demand for the company’s industry-leading artificial Intelligence chips.
The S&P 500 index, which is widely considered a barometer for the health of American corporations, closed at 5,087.03, a record high. This was its 12th highest closing price of the year. The Dow Jones Industrial Average closed above 39,000 points for the first time. It gained 456.87, or 1.2 percent, to 39.069.11 – its 13th record since the beginning of last month. The Nasdaq composite, which is heavily influenced by technology, closed the day up 3 percent at 16,041.62, marking its second-highest close.
Nvidia is the market leader in high-end AI chips, with Microsoft, Meta, and Amazon as customers. It reported its latest earnings late on Wednesday after normal trading hours ended. The company forecast current-quarter revenues of approximately $24 billion compared to expectations of $22.2billion. The total revenue for last year reached a record of $60.9 billion. This was largely due to the strong sales of AI chips for server, especially the Hopper chips such as the H100.
Grace Hopper superchip was one of the products that helped push total revenue to $60 billion.
Nvidia shares rose 10% in late Wall Street trading after the earnings announcement, to $738.63. This valued the company at $1.7 billion. The stock rose 16.4%, or $101.66, to $785.38 on Thursday. This was a record and gave the company a market cap of $1.9 trillion. The shares have risen by 232 percent in the last year. Nvidia has now become the third most valuable stock on the market, surpassing Alphabet (which owns Google) and Amazon.
Peter Garnry is the head of equity strategy for Saxo Bank. He said, “We’ve never seen anything similar in the equity markets in terms of a 265 percent revenue growth year-on-year rate, and this company will be expected to report revenue of around $100 billion over the next four quarterly quarters. It shouldn’t be possible.”