Stock market today: S&P, Dow hit record highs as Nvidia ignites global rally | February 22, 2024

Stock market today: S&P, Dow hit record highs as Nvidia ignites global rally | February 22, 2024

NVIDIA and the AI Boom

  • NVIDIA's strong earnings report, beating expectations on both revenue and earnings per share, sparked a rally in the stock market.
  • The company's focus on generative AI and the increasing demand for countries to develop their own AI capabilities is seen as a key driver of growth.
  • Despite a slowdown in revenue from China, analysts remain bullish on NVIDIA, with 90% having a buy rating on the stock.
  • NVIDIA's performance is crucial for the broader market, as the tech sector, particularly info tech and communication services, has been leading the S&P 500's performance.
  • The demand for NVIDIA's hardware indicates a growing demand for AI among companies, which bodes well for software vendors in the AI space.
  • The momentum behind AI investment is expected to continue, benefiting not only NVIDIA but also its rivals in the tech industry.
  • Original equipment manufacturers (OEMs) are seen as potential beneficiaries of the growing demand for AI, as they play a crucial role in the AI ecosystem.
  • NVIDIA's dominance in AI and large language models is expected to continue for the next 12-18 months.
  • AMD is well-positioned to gain market share from NVIDIA in AI and inference.
  • Taiwan Semiconductor will continue to be a key enabler for AI and semiconductor companies.

Moderna's Pipeline and COVID Vaccine

  • Moderna beat market expectations despite a decline in COVID vaccine sales, and the company increased its market share for COVID vaccines in the last quarter.
  • Moderna is focusing on the launch of its RSV vaccine this year.
  • Moderna is working on a combo flu/COVID vaccine and has a partnership with Merck for a cancer vaccine.
  • Moderna is one of the first companies to use AWS to identify the current vaccine.

Etsy's Growth and Challenges

  • Etsy beat the street's expectations, but its guidance and warning for a slower fiscal year pressured shares.
  • Etsy is investing in large language models to improve user experience and drive up gross merchandise sales and volume on the platform.
  • The macro environment is the key driver for Etsy's growth in the next three to five years.
  • Temu and Shein's aggressive marketing strategies pose a near-term challenge for Etsy, but it is not seen as an existential threat.

Market Rally and AI Stocks

  • NVIDIA's strong earnings report led to a 12.5% increase in its stock price, setting a new record at the open.
  • The broader market also experienced gains, with the S&P 500 up 1.3% and the Russell 2000 up 0.4%.
  • NVIDIA's performance in the first 30 minutes of trading will indicate if it can break out of its tight upper range.
  • Other chip stocks, such as Intel and AMD, also saw significant gains.
  • The Nikkei Index in Japan hit a 40-year high due to the rise of some of Intel's suppliers.
  • Financials have recently taken off, breaking out of a sideways pattern, with Goldman Sachs being a notable performer.
  • The Nasdaq 100, led by NVIDIA's 12% gain, is up 54% over the last three months.
  • NVIDIA's consistent quarterly performance aligns with its stock rally, making it a notable case study.
  • The question remains whether other companies will benefit from AI at the same scale as NVIDIA.
  • Chasing the rally in NVIDIA may carry risks, and investors should consider portfolio diversification to mitigate potential market risks.
  • The market's fundamental basis has become more challenging, but NVIDIA's numerous chip orders provide stability.

Moderna's Pipeline and Cancer Immunotherapy

  • Moderna's surprising profit, despite a 40% decline in vaccine sales, highlights a shift in the narrative and growing excitement about cancer immunotherapy.
  • Oppenheimer's bio analyst emphasizes Moderna's transition from a COVID-19 vaccine-focused company to a five-product company in 2026, with a focus on pipeline development.
  • The company's mRNA platform enables shorter development times and increased probability of success, leading to faster product approvals and beating historical estimates.
  • Investors should focus on the pipeline discussion in the coming six to nine months, as Moderna's relentless pursuit of pipeline development drives the company's growth.

EV Demand and Challenges

  • Rivian and Lucid's stocks decline due to lower-than-expected guidance and deliveries, reflecting diminishing demand for EVs and challenging market conditions.
  • The high price points of Rivian and Lucid vehicles further impact their margins, especially in the context of Tesla's price war.
  • Nikola Corporation, a manufacturer of hydrogen fuel cell electric trucks, delivered its first production vehicle in North America.
  • The company faced challenges and leadership changes, including an

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