Home » Stock markets still at highs, “hangover” of increases driven by Nvidia’s AI

Stock markets still at highs, “hangover” of increases driven by Nvidia’s AI

by admin
Stock markets still at highs, “hangover” of increases driven by Nvidia’s AI

A week to remember for the main international indices thanks to the most awaited quarterly of the year which did not disappoint expectations. Nvidia generated higher revenues in the final three months of 2023 than all of 2021, confirming the company’s record growth thanks to global investments in artificial intelligence (AI). How have the main global indices reacted and where are the current prices?

If you want updates on World News enter your email in the box below:

By filling out this form I agree to receive information relating to the services on this page in accordance with the privacy policy.

Where are the markets at?

Yesterday was a banner day for stock prices, with optimism around artificial intelligence (AI) fueling a market boomespecially after Nvidia beat quarterly earnings expectations by a wide margin.

The strongest effect was seen on Wall Street, where the main indices recorded their best session in over a year, reaching new historic highs. “Once again, traders favored large-cap companies, betting on the long-term reach of AI-related issues in a context in which rates still remain high and continue to represent a brake on the appetite for small caps” comment the analysts of MPS Capital Services.

Even today, purchases do not stop with theS&P 500 traveling above 5,100 points, marking a 7% increase year to date and a 28.6% gain over the past 12 months. Virtually the same ytd performance for the Nasdaq, while the one-year progress is around 41%.

“We are in the middle of a new round of investments worth several hundred billion dollars which perhaps won’t change the world, but will certainly have a non-negligible impact on the economy, not just the American one, in the coming quarters, with related activities that are difficult to quantify at the moment” states Paolo Mauri Brusa, manager of the Multi Asset Italia team of GAM (Italy ) SGR.

See also  The iPhone 14 Pro film is on the shelves: Apple has replaced the bangs that Apple has used for 5 years with an exclamation mark- Apple iPhone

And perhaps it is not just a coincidence that the Japanese Nikkei 225 price list closed at 39,098 points the very day after Nvidia’s data, exceeding after 35 years the maximum of 38,957 points was achieved way back in 1989. A record further broken even today with a closing close to 39,100 points (+2.2%), which brings the performance from the beginning of 2024 to +16.8% and that of the last 12 months to +42.4%.

How did European stock markets react? The Wall Street euphoria also spread to the Old Continent, where the major continental indices Euro Stoxx 50 and Stoxx Europe 600 have updated their previous absolute records, as well as the German Dax and the French Cac 40. And the major Italian index? The Ftse Mib is in the 32,680 point area, marking +7.7% ytd and approximately +21% in the last year.

The technical point on the Ftse Mib

The Ftse Mib presents a bullish trend in the medium and short term. After the double bottom of 4 and 26 October last year, the Italian index started a bullish trend which stopped for a break in the months of December and January, forming a lateral channel between the support at 30,000 points and the resistance at 30,650 points. At the end of January the Ftse Mib carried out the break in the upper part of the channelthen it surpassed the static level at 30,650 points, and then resumed the bullish trend.

Two sessions ago, the Italian index surpassed with momentum, with a gap up, the psychological threshold of 32,000 points, reaching today a intraday high at 32,707 pointsa price level that had not been seen since May 2008.

See also  Piquadro becomes carbon neutral - FinanzaOnline

In tale scenario, the next upward target remains 33,000 points, while on the downside the first support is found at 32,000 points. The next target to go down is 31,400 points, a price area where the bullish trendline built on the lows of October 2023 and January of this year also passes (blue line).

From an algorithmic point of view, the14 period RSI oscillator (the relative strength index) entered overbought territory yesterday, underlining the strength of bullish pressures in this market phase. What does this mean according to technical analysis? Overbought means that the price rose rapidly in a short time because many investors entered. As a result, a short price correction may follow.

However, the graphic picture of the Ftse Mib is positive, finding itself above the main moving averages: it is approximately 13% from the 200-period one (orange line), while from the 50-period one (yellow line) it is approximately 6%.

Source: Bloomberg. Chart of the Ftse Mib index in the last six months with daily timeframe

You may also like

Leave a Comment

This site uses Akismet to reduce spam. Learn how your comment data is processed.

This website uses cookies to improve your experience. We'll assume you're ok with this, but you can opt-out if you wish. Accept Read More

Privacy & Cookies Policy