Stocks were mixed on Thursday as Nvidia Corp shared spiked to get a tech stock rally underway. The software company’s shares surged by 24.37% after it released a positive earnings outlook that exceeded Wall Street expectations.
The S&P 500 edged 0.88% higher, while the tech-heavy Nasdaq Composite index spiked 1.71%. In contrast, the Dow Jones Industrial Average ended the day’s trading 0.11% lower.
Nvidia, which has catapulted into a poll position in the artificial intelligence race, released an $11 billion second-quarter revenue projection, significantly exceeding analysts’ $7.2 billion projection as released by Bloomberg. Nvidia’s rally was followed by fellow AI-heavy stocks Alphabet and Microsoft, whose shares advanced approximately 2% and 4% respectively.
“In 22 years of covering tech stocks and large-cap we have never seen a guidance range of this magnitude on a large cap tech name,” Wedbush managing director Dan Ives observed. “And thus speaks to our thesis that the monetization of AI for stalwarts like Microsoft, Alphabet, Amazon, Oracle, Meta, Apple, and Salesforce is well underway.”
The newfound tech rally helped to subdue investor concerns regarding the stalling U.S. debt ceiling talks. Also on investors’ and economists’ radars were the quarterly GDP reading, which showed 1.3% U.S. economic growth in Q1, and the weekly jobless claims report, which showed a lower-than-expected 229,000 claims filed for the period.