What Does Nvidia's Soaring Stock Price Mean for Global Assets?

Semiconductor and AI-related tech stocks jumped on Thursday after $NVIDIA(NVDA.US)$, a leader in AI, reported its fourth consecutive earnings beat and raised forecasts. Nvidia's fourth-quarter earnings exceeded analyst expectations with revenue of $22.1 billion resulting in $12.29 billion in earnings.

Enthusiasm over the AI surge, expected to advantage not only Nvidia but also the hardware firms integral to AI infrastructures, propelled a multitude of tech stocks upward on Thursday. The $iShares Semiconductor ETF(SOXX.US)$ hit a record high, climbing over 4% to surpass $643. $Advanced Micro Devices(AMD.US)$, a major competitor of Nvidia, saw its shares increase by nearly 11%. Companies like $ASML Holding(ASML.US)$ and $Applied Materials(AMAT.US)$, which produce equipment for manufacturing advanced semiconductors, both saw gains of over 4%.

$Super Micro Computer(SMCI.US)$, a data center technology firm, experienced a surge of more than 32% in its stock value, outpacing Nvidia's post-earnings rise and tripling its share value within the current year. Chip designer $Arm Holdings(ARM.US)$, a client of Nvidia, also saw a 4% rise in its shares. Earlier in the month, Arm's stock had a nearly 50% single-day jump after it exceeded earnings expectations and raised its year forecast due to the booming AI demand.

The $S&P 500 Index(.SPX.US)$, the key indicator of Wall Street's performance, ended the day 2.1% higher, achieving its largest one-day increase since January 2023 and exceeding the previous week's peak. The tech-centric $Nasdaq Composite Index(.IXIC.US)$ climbed nearly 3%, marking its most impressive day in over a year and setting a new record.

The enthusiastic response to Nvidia's earnings had a global impact, with the Stoxx Europe 600, Japan's $Nikkei 225(.N225.JP)$, and the FTSE All-World index all reaching unprecedented highs.