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Nvidia Closes at All time High Threatens to Dethrone Apple As Most Valuable Company

Nvidia Closes at All-Time High, Threatens to Dethrone Apple as Most Valuable Company

Shares of Nvidia (NASDAQ: NVDA) closed at their highest ever on Monday, putting the heavyweight AI chipmaker on the brink of dethroning Apple (NASDAQ: AAPL) as the world’s most valuable company.

With investors betting on strong demand for its current and next-generation AI processors, the Santa Clara, California company’s stock climbed 2.4% to end the day at $138.07.

In June, Nvidia briefly claimed the title of the world’s most valuable company before Microsoft (NASDAQ: MSFT) overtook it. For several months, the market capitalizations of the tech trio have remained neck-and-neck.

The latest gains lifted Nvidia’s market value to $3.39 trillion, just below Apple’s $3.52 trillion value and above Microsoft’s $3.12 trillion.

Nvidia (NASDAQ: NVDA) has been Wall Street’s biggest winner from a race between Alphabet (NASDAQ: GOOG), Microsoft (NASDAQ: MSFT), Amazon (NASDAQ: AMZN), and other major tech companies to dominate emerging AI technology.

“We believe the major companies in AI … face an investment environment characterized by a Prisoner’s Dilemma — each is individually incentivized to continue spending, as the costs of not doing so are (potentially) devastating,” TD Cowen analysts wrote in a report on Sunday.

TD Cowen reiterated its $165 price target for Nvidia, which it called its “Top Pick”, and it said demand for the company’s current generation of AI chips remained strong.

In August, Nvidia (NASDAQ: NVDA) confirmed reports that it delayed the ramp-up in production of its upcoming Blackwell chips until the fourth quarter but downplayed the impact, stating that customers were snapping up existing chips.

As investors gear up for quarterly reporting season, Apple (NASDAQ: AAPL) rose almost 2% and Microsoft (NASDAQ: MSFT) added 0.7%, helping propel the S&P 500 up 0.8% to its own record-high close.

Nvidia, Apple, and Microsoft account for about a fifth of the S&P 500’s weight, giving them a hefty influence in the index’s day-to-day gains and losses.

Taiwan Semiconductor Manufacturing Co (NYSE: TSM), the contract manufacturer that produces Nvidia’s processors, will report a 40% leap in quarterly profit on Thursday, thanks to soaring demand.

Analysts expect spending to build out AI data centers will help Nvidia’s annual revenue more than double to nearly $126 billion, according to LSEG data.

While Nvidia’s rally has lifted the S&P 500 to record highs, investors worry optimism about AI could evaporate if signs emerge of a slowdown in spending on the technology.

(Source: ReutersReuters)

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Jennifer Tacker
Jennifer Tacker is a staff writer at ABBO News. She holds a B.A. from the University of Waterloo and a B.Ed from Western University. Jennifer has been active in the stock market and crypto sector for a decade. She specializes in technical analysis and trading strategies.