Stocks Gain as Bullish Nvidia Call Enhances AI Trade – US Market Wrap

A rally in chipmakers pushed stocks to a new high, with traders betting that the prospect of Federal Reserve rate cuts will keep fueling the industry that has driven the equity market this year.

The S&P 500 edged closer to the historic 5,500 level. Nvidia became the world’s most valuable company, surpassing Microsoft and extending this year’s record-breaking rise. A bullish analyst call predicted that the company at the center of the artificial intelligence boom would be worth nearly $5 trillion in the coming year, up from $3.3 trillion. Bond prices rose as traders bought into a $13 billion sale of 20-year Treasuries.

Wall Street waded through mixed economic data that showed that US industrial production increased, aided by a broad-based increase in manufacturing output. Separately, retail sales barely increased, and previous months were revised lower. Before lowering interest rates, a chorus of Fed officials emphasized the need for more evidence that inflation is cooling.