4:15pm: Nvidia's surge eases
Two major stock indexes declined on Thursday after reaching record highs earlier in the session.
The S&P 500 briefly crossed 5,500 for the first time before losing 0.2% to end at 5,473 while the Nasdaq touched new highs but closed down nearly 0.8% at 17,722; the Dow Jones Industrial Average rose about 0.7% to close at 39,135.
Nvidia's shares fell over 3% after a rapid surge that made it the world's most valuable public company.
Meanwhile, global central banks made headlines with the Swiss National Bank cutting rates and the Bank of England maintaining its rate, while U.S. jobless claims dipped slightly to 238,000.
12:05pm: Dow outperforming Nasdaq
US stocks inched higher at midday, with the Dow Jones leading the gains.
The Dow Jones added 0.2% at 38,925 points with the S&P 500 hovering just below 5,500 points at 5,491 points.
The Nasdaq, meanwhile, was flat at 17,858 points.
IG chief market analyst Chris Beauchamp highlighted that for a change the Dow Jones is outperforming the Nasdaq so far in the session.
“The Nasdaq 100’s ascent has paused for now following its move to 20,000, but instead the lagging Dow Jones has made headway in early US trading,” he said.
“Broadening participation in the rally would be a major boost for investors, who have fretted about the sustainability of the rally, given that it was big tech that was making all the running.”
NVIDIA, which earlier this week overtook Microsoft as the most valuable public company, continued to add to its lead up 1.2% at about $137 per share giving it a market capitalization of $3.37 trillion to Microsoft’s $3.3 trillion.
10:02am: Positive start
US stocks have started higher, with new record highs for the Nasdaq benchmark and S&P 500, up 0.3% and 0.3% respectively so far, as is the Dow Jones.
The world's most valuable company, NVIDIA Corp (NASDAQ:NVDA, ETR:NVD) (NVIDIA Corp (NASDAQ:NVDA, ETR:NVD)), is doing a lot of the heavy lifting, up another 3.8% today to a new record of its own, a $3.42 trillion valuation.
Its shares are up almost 7% this week, almost 50% higher this month alone and has rocketed over 190% in the year to date.
NVIDIA's graphics processing unit (GPU) chips are the "new gold", said one analyst, as they are the AI economy’s precious commodity.
"Nvidia's GPU chips are in essence the new gold or oil in the tech sector as more enterprises and consumers quickly head down this path with the 4th industrial Revolution well underway,” Dan Ives of Wedbush said in a note.
"Its all about the pace of data center AI driven spending as the only game in town for GPUs to run generative AI applications all go through Nvidia."
Shares in Microsoft and Apple, put into second and third place earlier this week, are both down so far today, as is Tesla, though the other members of the so-called Magnificent Seven (it could be that Nvidia is a Mag One on its own) are up, namely Alphabet, Amazon and Meta.
6.51am: US stock futures point to new record highs
Wall Street returns to action today after the Juneteenth holiday yesterday, with stock futures pointing to a positive start.
Nasdaq 100 futures are up 0.67%, followed by S&P 500 futures pointing to a 0.41% gain and those for the Dow Jones just above flat.
This would take the Nasdaq and S&P 500 to fresh all-time highs, while the Dow and the mid-cap domestically focused Russell 2000 remain somewhat adrift of their own best levels.
Looking at individual equities, all the ‘Magnificent Seven’ are firmer in premarket trade, with NVIDIA the standout performer, trading 2.8% higher premarket to anticipate yet another record high.
"As usual, there are concerns about the US market’s lack of breadth with so much of the overall performance concentrated in the stock price of a few corporations," says market analyst David Morrison at Trade Nation.
"In fact, the five biggest companies by market capitalisation in the S&P 500 account for nearly 30% of its value. The size and outperformance of this select group is reflected in its valuation which is way above that of the rest of the constituents."
According to FactSet, the forward twelve-month P/E for the S&P 500 is 21, which is itself above both the five-year (19.2) and ten-year (17.8) averages, while the forward P/E for the five market leaders is 31.
"This is certainly unbalanced," says Morrison. "But what it tells us about where the market goes next is far from clear. These giant corporations can continue to lead and drive the rest of the market for longer than most of us can imagine.
"How these imbalances get rectified is also something that is unknowable, although we can all have a pretty good guess."