Megacaps rally pushes S&P 500 to first close above 5,000 milestone

economictimes.indiatimes.com:

Nasdaq briefly traded above 16,000, with boosts from megacaps and chip stocks, including Nvidia as investors bet on artificial intelligence technology and eyed strong earnings data.

Nvidia finished up 3.6% and hit a record high after Reuters reported it was building a new business unit focused on designing bespoke chips for cloud computing firms and others, including advanced artificial intelligence (AI) processors.

This was after the Wall Street Journal reported Thursday that OpenAI Chief Executive Sam Altman was in talks with investors to raise funds for a tech initiative intended to boost chip-building capacity for power AI, among other things.

«The AI story so far has been all about building the infrastructure, the chips, the data centers,» said David Lefkowitz, head of U.S. equities at UBS Global Wealth Management, adding that the report «at least underscores that there's potentially a tremendous amount of demand going forward for AI infrastructure.»

While Lefkowitz said the S&P and Nasdaq's round number milestones likely won't change investors calculations of the markets risk and reward prospects, he said, «it raises the profile of what's happening in the market.»

Along with outperformance by the Philadelphia semiconductor index, which closed up 1.99%, technology-focused market heavyweights, including Microsoft, Amazon.com and Alphabet also contributed to index gains.

With results in from about two-thirds of S&P 500 companies, LSEG data now shows Wall Street estimates for fourth-quarter earnings growth