Key points:

  • The Nasdaq crossed 17,000 points for the first time in history, closing at 17,019.88, up 0.59%.
  • Apple shares rose after reporting growth in iPhone sales in China.
  • Nvidia shares rose 7%, pushing the company toward the second-largest market capitalization on Wall Street.

The Nasdaq crossed 17,000 points for the first time in history, closing at 17,019.88, up 0.59%. The growth was driven by growth in Nvidia shares.

The S&P 500 index showed slight gains, ending at 5,306.04, up 0.02% from the previous day. By contrast, the Dow Jones Industrial Average lost 0.55% to 38,852.86 as Treasury yields rose.

Apple shares rise after news of sales in China

The S&P 500’s technology sector led the gainers, while healthcare and industrials posted the biggest declines.

Investors remain optimistic, betting on a possible Fed rate cut this year.

Expectations regarding the timing of rate cuts are mixed. Policymakers are cautious as data continues to reflect persistent inflation.

The likelihood of a rate cut of at least 25 basis points in November and December this year exceeds 50%. In September, the likelihood of a rate cut fell to about 46% from more than 50% a week ago. The retail sector will also be in focus this week. Several retailers, such as Dollar General, Advance Auto Parts and Best Buy, will report their results.

Apple shares rose after iPhone sales in China rose 52% in April from a year earlier, based on industry data. But the stock pared gains late to close just slightly higher at $189.99.

Nvidia shares rose 7%

Nvidia shares soared 7%, dragging shares of other chip makers with them, pushing the company toward the second-largest market capitalization on Wall Street. The gap behind Apple is only $100 billion, which marks a major change in the balance of power among the largest players on the exchange.

At last trading, Nvidia shares were quoted at $1,128, which corresponds to a market capitalization of $2.8 trillion. Apple, second only to Microsoft, is valued at $2.9 trillion.

Nvidia’s stock surged 13% over the past week as it beat Wall Street’s second-quarter revenue expectations and announced a stock split. Investors remain optimistic about the future of AI, fueling demand for the company’s shares.

Nvidia trades at a premium to forward earnings estimates of 36 times Advanced Micro Devices’ 38 and 21 times Intel’s. Nvidia shares have more than doubled this year, doubling their gains over the past year.

The company, one of the leaders in the field of artificial intelligence, reported a fivefold increase in revenue in the data center segment for the past quarter. Customers are lining up for Nvidia’s high-performance chips as they strive to dominate AI computing. Competition for Nvidia’s products is heating up as tech giants like Alphabet, Microsoft and Amazon also compete for the limited supply of these chips.