On Tuesday, May 28, 2024, local time, the US Nasdaq index rose 0.59% and the S&P 500 rose 0.02%. In terms of constituent stocks, most large technology stocks rose, with Nvidia rising nearly 7%, Asma and AMD rising over 3%, Qualcomm and Intel rising over 1%, and Google Meta slightly rising.
The Nasdaq's current rise is mainly driven by technology giants represented by Nvidia. Nvidia released its latest financial report last week, which showed that its revenue, data center revenue, net profit, and profit margin far exceeded market expectations. In addition, when looking forward to the annual performance outlook, Nvidia stated that its B-series new products will start production in the second quarter, ramp up in the third quarter, and are expected to be shipped in the fourth quarter. This year, the B-series will bring in significant revenue. Nvidia's comprehensive performance exceeding expectations and optimistic outlook on future business prospects once again confirm the beginning of AI or the fourth round of technological revolution. Strong downstream demand may drive further high-speed growth in the field of artificial intelligence, and global technology giants represented by Nvidia are expected to continue to benefit from this wave of AI.
In addition, Nvidia has also announced a "1 split 10" stock split plan, which will officially take effect after the market closes on June 7th. At that time, the company's stock price will be adjusted, with each share split into 10 shares; This means that more funds can participate in the purchase of Nvidia stocks. Thanks to this positive news, Nvidia's total market value has reached $2.8 trillion, just over $100 billion less than Apple's.
US stock technology has performed exceptionally well over the past 23 years, frequently reaching historic highs, but the high points do not diminish the value of US stocks as long-term investment assets. From the perspective of valuation and profit breakdown, the dominant factor for the rise of the US technology sector is strong profits. Among the more than 12% increase in the Nasdaq 100 index since the beginning of the year, profit contribution accounts for the majority, which reflects the strong demand in the AI industry. In addition, the strong profitability of technology leading companies has brought them abundant cash flow, and their repurchase volume in the first quarter increased by 17% month on month to $55 billion, which may become an important driving force for the rise of the US stock market.
Looking ahead to the future, the US stock market has always been rational, focusing more on profitability and fundamentals. On the one hand, the resilience demonstrated by the US economy provides a solid foundation for the US stock market; On the other hand, many listed companies in the US stock market have absolute pricing power and ability in their segmented areas, with strong profitability, which is expected to drive S&P and Nasdaq to reach new historical highs. As for the monetary policy that investors are concerned about, Tianhong Fund believes that although interest rate cuts are delayed, they will arrive. It is recommended that investors do not need to bet on the specific timing of interest rate cuts and allocate assets along the direction of interest rate cuts, which is more cost-effective for the long-term upward trend of the US stock market. Investors who are interested in US stocks can follow the Tianhong S&P 500 (Class C: 007722) and the Tianhong NASDAQ 100 Index (Class C: 018044). There are risks in the market, and investment should be cautious. The above stocks are only for objective display and not for individual stock recommendations.