(Reuters) – The S&P 500 and Dow Jones Industrial Average both surged to record closing highs on Thursday, powered by investors piling into growth and technology stocks the day after artificial intelligence poster child Nvidia’s bumper earnings and outlook.
For the S&P 500 (.SPX), opens new tab benchmark, it was also the largest daily gain in 13 months. The Nasdaq Composite notched its biggest single-session advance in a year and just missed a record finish.
Investors eagerly bought stocks as Nvidia shares jumped 16.4% after the chip designer forecast a roughly three-fold surge in first-quarter revenue on strong demand for its AI chips and beat expectations for fourth-quarter revenue.
The company’s earnings were a major test for the AI-fueled rally on Wall Street that first pushed the S&P 500 (.SPX), opens new tab above the 5,000 point mark earlier this month. Some analysts had cautioned that disappointing results could spark a steep selloff among technology stocks.
Instead, the S&P 500 (.SPX), opens new tab ended at a record high, gaining 105.23 points, or 2.11%, to 5,087.03, as did the Dow Jones Industrials (.DJI), opens new tab, which closed at 39,069.11 after rising 456.87 points, or 1.18%. It was the first time the Dow has ever finished above 39,000 points.
The Nasdaq Composite (.IXIC), opens new tab added 460.75 points, or 2.96%, to 16,041.62.
“As Nvidia goes, so goes the world,” joked Jack Janasiewicz, lead portfolio strategist at Natixis Investment Managers Solutions.
He noted how Nvidia’s earnings performance trounced high market expectations, showing doubters that plenty of juice was left in the AI trade after the recent rally.
“When do you sell – maybe you don’t. Maybe there’s still room, and I’m happy to sit and ride it out,” Janasiewicz added.
Nvidia added $277 billion to its market capitalization, beating Meta Platform’s $196 billion surge earlier this month as the biggest one-day gain by any company in Wall Street history.
Those shorting Nvidia stock were left nursing more than $2.9 billion of paper losses, per data from Ihor Dusaniwsky, managing director of predictive analytics at S3 Partners.
