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S&P 500 hits record high as Nvidia's blowout earnings keeps bulls marching on

Published 22/02/2024, 10:54 am
Updated 23/02/2024, 05:28 am
© Reuters

Investing.com-- The S&P 500 jumped to a record high Thursday, underpinned by AI darling Nvidia following the chipmaker's blowout quarterly earnings.  

By 13:22 ET (18:22 GMT), the Dow Jones Industrial Average was up 343 points, or 0.9%, S&P 500 rose 1.9% hitting a fresh intraday record high of 5,078.14. The Nasdaq Composite climbed 2.7%.

Nvidia lifts tech after strong Q4 results, outlook  

Nvidia (NASDAQ:NVDA) stock jumped over 14% Thursday to hit fresh record highs after the world’s most valuable chipmaker reported stronger-than-expected fourth quarter earnings, and forecast first quarter revenue at about $24 billion, more than what analysts were expecting. 

The stronger guidance "implies solid growth off the higher number again fueled by the velocity of NVDA's datacenter business," Wedbush said in a note as it upgraded its price target on the stock to $850 from $800.

Other chipmakers jumped on the Nvidia bandwagon, with TSMC (NYSE:TSM) Micron Technology (NASDAQ:MU) and Intel (NASDAQ:INTC) in the ascendency. 

Nvidia, a barometer of AI demand, reinforced expectations that the AI boost is here to stay, stoking bullish bets across megacap tech including Alphabet (NASDAQ:GOOGL), Microsoft (NASDAQ:MSFT) and Meta Platforms (NASDAQ:META) all posted healthy gains, with all three having AI products in the pipeline. 

Moderna posts surprise profit, Etsy, Rivian disappoints on earnings stage, but Royal Carribbean shines 

Moderna (NASDAQ:MRNA) rose 14% after reporting a surprise fourth-quarter profit helped by cost cutting and some deferred payments. 

Etsy (NASDAQ:ETSY) slumped 8% after the e-commerce firm reported mixed earnings and softer guidance that underscore the tough economic backdrop and competition in the e-commerce landscape, Wedbush said.  

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Rivian Automotive (NASDAQ:RIVN) fell 22% after it production for 2024 that fell short of estimate as electric vehicle manufacturer grapple with waning demand. The EV maker is set to launch its R2 compact SUV in March, which will be important, RBC said, as the investment case on the stock "relies on this higher volume, affordable product."

Royal Caribbean (NYSE:RCL) stock rose 6% after the cruise operator raised its full-year income forecast, saying it has been encouraged by both the "demand and pricing environment" in 2024.

Treasury yields rise on signs of strong labor market 

Treasury yields were sharply higher following fresh signs of strength in the labor market a the number of Americans filing new claims for unemployment benefits unexpectedly fell last week, the Labor Department reported Thursday. 

The data added fresh doubt on the sooner rather later rate cuts and came just a day after the Fed minutes reinforced the central bank’s stance on keeping interest rates elevated in the near-term.

Federal Reserve Vice Chair Philip Jefferson said Thursday he was "cautiously optimistic" in the Fed's ability to rein in inflation back down to its 2% target.

"If the economy evolves broadly as expected, it will likely be appropriate to begin dialing back our policy restraint later this year," he added.

Elsewhere on the economic front, manufacturing activity picked up pace in February, but  services slowed. 

(Peter Nurse, Ambar Warrick contributed to this article.)

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