The S&P 500 notched a record high close on Wednesday ahead of quarterly results from Nvidia, Wall Street’s most closely watched event this week, which will test the rally that has pushed valuations of AI-related companies to levels that some investors view as too high.
Shares of Nvidia, the world’s most valuable company and the leading supplier of cutting-edge AI processors, bounced between gains and losses before ending down 0.1% ahead of the report, due after the market closes.
With Nvidia making up about 8% of the S&P 500, its financial results affect vast numbers of Americans who use index investment funds to save for retirement.
“Nvidia is going to produce humongous revenue gains over the next nine months, on top of an already humongous revenue base,” said Jed Ellerbroek, portfolio manager at Argent Capital.
“Investors should prepare themselves for a world where Nvidia is a double-digit percentage of the S&P 500.”
Shares in tech and AI heavyweights were mixed, with Microsoft gaining nearly 1% and Meta Platforms dipping almost 1%. They, along with Alphabet and Amazon, are among Nvidia’s biggest customers.
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Author: Faith Novak
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