The stock added about NOK 2,900 billion in market value on Thursday. No stock has ever risen more in one day.
Nvidia is best known for producing computer chips. Many of them are needed if the whole world is to start using various solutions with data-intensive artificial intelligence. Photo: DADO RUVIC / Reuters / NTBPublished:
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This week, Wall Street has been closed on Monday, pointed down on Tuesday and finished mixed and flat after a small closing spurt on Wednesday.
Thursday ended like this:
- Dow Jones up 1.2 percent.
- The technology index Nasdaq rose 3 percent.
- The collective index S&P 500 increased 2.1 per cent.
It was thus Nasdaq’s biggest increase since February last year, writes CNBC. One company in particular contributes to that.
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The topnoting
The share of Nvidia, which among other things produces the computer chips that AI companies need, jumped 16 percent to a new top listing.
The computer chip manufacturer presented quarterly figures after the close of trading on Wednesday. They showed a strong increase in income, better than the market had expected.
The company says demand is rising worldwide. They have now upgraded the outlook for the first quarter of 2024.
The share price has risen a whopping 277 per cent in the past year. So far this year, the increase is 57 per cent.
The company’s market value ended on Thursday at a whopping 1940 billion dollars. This corresponds to approximately NOK 20,300 billion.
15 percent of the oil fund – in one day
On Thursday alone, the market value increased by 277 billion dollars. In kroner, it is approximately 2,900 billion.
According to Bloomberg, the pair represent the largest increase in value in history in one trading day. Facebook owner Meta accounted for the existing top listing at the start of the month. The jump was about NOK 2,000 billion.
Nvidia’s value increase on Thursday alone corresponds to around 17 percent of the Oil Fund. As for the fund’s investment in the AI favourite, the last update, from 31 December last year, showed an ownership position of 1.17 per cent. That then corresponded to 14.3 billion dollars.
If the ownership position has not changed after this, the value has increased to $22.7 billion. This means that the Nvidia rise has added around 8.4 billion dollars (88 billion kroner) to the Oil Fund in less than two months.
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Blood red for shorts
But not everyone believes the ascension will last.
At the same time that Nvidia is now one of the world‘s largest companies, measured by market value, enormous sums have also been placed on the price to fall, so-called shorting.
A total of 18.3 billion dollars has been invested in this way, according to the company S3 Partners. For the computer chip sector as a whole, a total of USD 59 billion must be bet on a drop in the price.
In a post they write that the shorts have mostly kept their positions recently, even though computer chip companies have risen a lot on the stock exchange. Thursday was especially expensive.
Nvidia’s “explosive results” have created “an AI-generated nightmare” for shorts, points out S3 Partners.
On Thursday alone, the losses amount to 2.8 billion dollars – almost NOK 30 billion.