In the meantime, investor interest in Nvidia remains frenzied. While some have speculated that its success might be a bubble, most Wall Street analysts say its financial statements have been proof the product is viable. “Additionally, the growth of their core data center business is genuinely stunning”, Goldman Sachs Tony Pasquariello wrote in a note to clients Friday.
Because it is now so much more valuable, Nvidia’s financial results carry greater weight for the overall stock market, namely the S&P 500 index. According to Agati, the Chief Investment Officer of PNC Financial Services, 60% of the earnings growth among all S&P 500 companies for the most recent quarter came from Nvidia alone.
In other words, for the moment, as Nvidia goes, so goes the market. This is a positive for consumers who hold investments in the stock market whether individually, or through their retirement accounts. For now, “Nvidia has become critical to the market’s path forward,” Agati said in an email to NBC News, adding “In the saying ‘data is the new oil’, Nvidia continues to prove it is in a league of its own”.
Semiconductors continue to move upward.
As most of you are aware, MarketGauge was an early pioneer in developing formulaic, quant based (algorithmic) investment strategies that are built on proprietary technology. These algo formulas emulate any of the trading patterns learned by Keith, Geoff and Mish on the floor of the commodity exchanges and then trading for one of the world’s largest hedge funds (at that time).
It continues to surprise me that our Algos uncover investment ideas that frankly I don’t always agree with. MOST of the time, they are correct, and I am wrong. Many times, over the past few years (especially 2020 pre-covid) these Algos got out of the market and ever since have often been investing earlier than a market’s initial move up. (April 2020 and October 2023 are two such examples)
Yes, we rode Nvidia quite a long time in a few of our strategies just like we did in Tesla, Meta, the homebuilders and even travel cruise company Royal Caribbean. Interestingly we are still invested in several of these names or sectors through stocks or ETFs.
