After surpassing Nvidia's (NVDA) huge profits, the AI industry is back in earnest, defying concerns that tech euphoria may have peaked.
Shares of SoundHound (SOUN) and Arm (ARM), companies in which Nvidia recently announced investments, both rose about 5% on Thursday. Another AI chip stock, AMD (AMD), rose more than 10%, and AI-driven stock Palantir soared more than 3%. Super Microcomputer (SMCI), which is up an astounding 200% this year, soared nearly 33% on Thursday alone.
Nvidia's success wasn't just limited to technology. The S&P 500 (^GSPC) and the Dow Jones Industrial Average (^DJI) closed at record highs. A number of other companies not focused on AI also closed at record highs on Thursday, including JPMorgan (JPM) and Waste Management (WM).
All of these gains come just days after reports of higher-than-expected inflation sparked a mini-market sell-off and continued to signal that Federal Reserve officials are likely to cut interest rates later than most expected. It happened a week later. These two headwinds are usually large enough to move the market. It's not Thursday.
For Evercore ISI's Julien Emanuel, the market's resilience amidst significant macro headwinds and high stock valuations was simply “impressive.”
“FOMO works on its own schedule, stocks can rise, and momentum ends when it ends, often without warning,” Emanuel said. “FOMO, continue bidding for now.”
Nvidia CEO Jensen Huang said Wednesday night that AI has reached a “tipping point” as demand continues to soar. For more on these comments and the company's overall quarterly earnings, Dan Ives, a managing director at Wedbush Securities, said in a note to clients that it's like “jet fuel” for the tech industry's bullish narrative.
Market questions remain about how long this euphoria will last. Thursday's market trends suggest there is still some leg left in the market for now.
“In short, I think it's too early to call the peak of the AI bubble,” Fundstrat head of research Tom Lee told clients Wednesday night.
Josh Schafer is a reporter for Yahoo Finance. Follow him on X @_joshschafer.
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