The S&P 500 and the Nasdaq Composite ascended to unprecedented intraday zeniths on Thursday, propelled by robust advancements in technology stocks, prominently featuring the semiconductor titan NVIDIA.
Meanwhile, investors were engrossed in analyzing economic indicators and monitoring key developments from the crucial US-China summit.
By 9:54 a.m. ET, the Dow Jones Industrial Average had surged by 270.32 points, equivalent to 0.54 percent, reaching 49,963.52 points.
The S&P 500 enhanced by 28.32 points, or 0.38 percent, to settle at 7,472.57, and the Nasdaq Composite ascended by 92.85 points, or 0.35 percent, culminating at 26,495.19.
NVIDIA Extends AI-Driven Surge
NVIDIA experienced a 3 percent increase, elevating the chipmaker’s market capitalization to approximately $5.6 trillion.
This ascension followed a report from Reuters, which, citing sources, indicated that the United States had authorized nearly 10 Chinese firms to acquire NVIDIA’s second-most formidable artificial intelligence chip, the H200.
Tech stocks, particularly those involved in semiconductor manufacturing, have profoundly influenced Wall Street’s recent surge to record levels, notwithstanding persistent apprehensions regarding the ongoing conflict in the Middle East and inflationary pressures stemming from escalating oil prices.
Cisco Surges Following Restructuring Announcement
Shares of Cisco Systems experienced an impressive rise of 14.7 percent, achieving an all-time peak subsequent to the networking behemoth’s declaration of its intention to eliminate nearly 4,000 positions as part of a strategic restructuring initiative.
The firm also increased its annual revenue projections in light of a significant uptick in orders from hyperscalers.
Among the 11 principal sectors of the S&P 500, nine registered positive performances, with the technology sector leading the way and climbing 1 percent.
Retail Sales Data Indicates Consumer Hesitance
US retail sales increased by 0.5 percent in April, aligning with market expectations. However, analysts posited that inflationary factors likely contributed to this uptick, particularly due to rising energy and commodity prices amid the conflict with Iran.
“Consumers are not in a recession, yet they are not propelling the economy forward,” stated David Russell, Global Head of Market Strategy at TradeStation. “Heightened inflation, tariffs, and demographic shifts have adversely affected retail spending as a growth facilitator.”
He further noted, “The day’s retail figures do not sound alarm bells for the Federal Reserve, which may maintain an upward inclination on interest rates. The consumer base is resilient enough to dismiss the notion of rate cuts.”
In a separate development, the count of Americans filing for unemployment benefits exhibited a modest increase last week, underscoring a stable labor market.
Focus Shifts to Trump-Xi Summit
Chinese President Xi Jinping conveyed to US President Donald Trump at the initiation of their two-day summit on Thursday that discussions pertaining to trade were advancing positively.
However, Xi cautioned that tensions surrounding Taiwan threatened to steer bilateral relations toward a precarious trajectory, possibly inciting conflict.
This summit unfolds against the backdrop of the enduring crisis in Iran. A White House official declared that both leaders concurred on the necessity of keeping the strait open and ensuring Iran’s nuclear ambitions remain thwarted.
Fed Rate Hike Expectations Intensify
The S&P 500 and Nasdaq had also concluded at record highs on Wednesday, furthering Wall Street’s current rally.
Robust consumer and producer price indicators released this week have bolstered anticipation that the Federal Reserve will adopt a more protracted restrictive monetary stance.
According to the CME Group’s FedWatch Tool, market participants are now pricing in over a 28 percent probability of a quarter-point interest rate hike before the year concludes, compared to just 20.7 percent a week prior.
Advancing stocks surpassed decliners by a margin of 1.7-to-1 on the NYSE and 1.03-to-1 on the Nasdaq.
The S&P 500 documented 17 new 52-week highs and six new lows, while the Nasdaq Composite recorded 50 new highs and 75 new lows.
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