The US stock market experienced a remarkable first half of the year, with the S&P 500 Index surging by 14% since January. The rally was driven by several factors, including artificial intelligence (AI) and improved corporate earnings. Nvidia, an AI darling and chip designer, saw its shares rocket higher by over 150%, symbolizing the success of the AI trade.
Despite fears of a US recession, Wall Street defied expectations and achieved record-breaking performance. President Joe Biden's weak showing in his first debate against Donald Trump drew investor attention, with Trump's promised tax cuts and trade clampdown seen as likely to boost stocks. However, shares in Trump Media & Technology Group lost 10% amidst the news.
The economy proved resilient during this period, with demand for companies linked to AI remaining strong. Nvidia's revenue surged threefold compared to the previous year due to high chip demand. Meta was also running a staggering 350,000 H100 chips this year alone to power its AI systems.
Microsoft, which has invested billions in AI startups including OpenAI and Wayve, saw its revenue increase by 17% year-over-year. Eli Lilly's share price was also on the rise due to strong demand for its weight loss drug Zepbound. During the first quarter of 2024, the newly-approved drug generated over $517 million in sales.
Despite these positive developments, it is essential to remain skeptical and consider diverse sources when reporting on stock market trends. The Federal Reserve's monetary policy decisions and geopolitical events can significantly impact the market.
