Athira Sethu
Kochi, 15 October 2024
Nvidia’s shares touched an all-time high on Monday and brought the company close to Apple, which is the world’s most valuable firm in the world. It surged 2.4% to close at $138.07 after investors cheered the strong demand for Nvidia’s current and forthcoming AI processors.
Earlier this year, Nvidia briefly became the world’s most valuable company before Microsoft returned to the top the ranks. The last two weeks, however, saw the three companies market values traded between each others places.
Nvidia has a market value of $3.39 trillion, but Apple leads the way with $3.52 trillion, and Microsoft comes in with $3.12 trillion. Nvidia is a giant winner in the competition between big tech companies like Alphabet, Microsoft, and Amazon to be at the forefront of the AI sector.
However, in the last week of August, Nvidia announced that its new Blackwell chips would be produced only after the fourth quarter. This does not seem to have derailed the momentum, as the company said existing chips were selling fast.
As the quarterly reporting season approaches, shares of Apple surged almost 2%, with Microsoft adding 0.7% to push the S&P 500 index higher by 0.8% in its latest trading day into record territory.
Companies such as Nvidia, Apple, and Microsoft still account for about 20% of the overall S&P 500 index, which means that the output of the companies has a significant impact on the daily fluctuations of the index.
Taiwan Semiconductor Manufacturing Company, in addition to processors made for Nvidia, might witness 40% growth in its quarterly profits driven by surging demand. The analysts further assess that AI data centers will eventually account for over one-fifth of the revenue that Nvidia makes annually, which will be much more than $126 billion.
However, with the rise of outstanding performance at Nvidia and its effect on S&P 500, some investors are still on a cautious note. They argue that if one sees a deviation of diminishing spending in technology, then the euphoria behind AI will fade away. In all, however, the stock performance of Nvidia goes to signal stronger investor confidence in AI as it is set to shape the trend in technology.
