Nvidia's AI chip boost lifts Nasdaq, S&P higher
Wall Street ended sharply higher on Thursday after a blowout forecast from Nvidia sent the chipmaker's stock soaring and fueled a rally in AI-related companies, while investors watched for signs of progress in US debt ceiling talks. Nvidia soared 24 percent to a record high close after the world's most valuable chipmaker forecast quarterly revenue 50 percent higher than estimates and said it was ramping up supply to meet demand for its artificial-intelligence (AI) chips. Investors exchanged almost US$60 billion worth of Nvidia's shares, accounting for a fifth of all trading in S&P 500 stocks during the session, according to Refintiv data. "Nvidia has officially replaced FANG as the centerpiece of this market," said Jake Dollarhide, chief executive officer of Longbow Asset Management in Tulsa, Oklahoma. "Investors are obsessed with AI, and Nvidia is the perfect AI story." Heavyweight AI players Microsoft and Alphabet rose 3.9 percent and 2.1 percent, respectively. Advanced Micro Devices jumped about 11 percent, Micron Technology added 4.6 percent and Broadcom climbed more than 7 percent. Wall Street has been jittery in recent days about dragging negotiations in Washington to raise the nation's US$31.4 trillion debt ceiling and avoid a default. US President Joe Biden and Republican lawmaker Kevin McCarthy on Thursday were edging close to a deal, with the parties just US$70 billion apart on discretionary spending, Reuters reported, citing a source familiar with the talks. The S&P 500 climbed 0.88 percent to end the session at 4,151 points. The Nasdaq surged 1.71 percent to 12,698 points, while the Dow Jones Industrial Average declined 0.11 percent to 32,765. Ralph Lauren rallied 5.3 percent after the luxury retailer beat profit estimates. Electronics retailer Best Buy rose 3.1 percent following upbeat quarterly earnings, while discount store chain Dollar Tree tumbled after cutting its annual profit outlook. (Reuters)