Shares of Nvidia are racing back to its all-time highs it clocked in March earlier this year, riding on the back on strong capital expenditure from its major customers and in anticipation of strong earnings later this month.
Nvidia shares have rebounded since the low of April 19, up 20% since then and is now short of the March peak by about 3 percent. Nvidia ended higher by 3.6% on Monday, adding over $70 billion in market capitalization.
Nvidia’s top customers like Meta Inc, Microsoft, Amazon and Alphabet have all laid out sustained plans of capital expenditures in their respective earnings calls. CIO of Americas at UBS Financial Services, Solita Marcelli told Bloomberg shares that are a play on AI computing are expected to stay attractive as capital expenditure from Microsoft, Alphabet, Meta and Amazon is expected to cross $200 billion this year, higher than a previous estimate.
The S&P 500 has now $2 trillion in market capitalization since the April 19 low, half of which has come the 'Magnificent Seven' technology stocks (Alphabet, Amazon, Apple, Meta Platforms, Microsoft, Nvidia, Tesla). Monday also marked the best three-day rally since November for S$P 500.
"The 'Magnificent 7' have performed pretty well this year, and part of the reason is because we are at the bottom of the technology cycle and we see a lot of upside ahead driven by many factors including AI," Delevska told Reuters, implying the major technology stocks should continue to do well in 2024 as well.
With inputs from Reuters and Bloomberg.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
