Mid-Year Recap | Nvidia Tops S&P 500 Stocks

The S&P 500 Index rises 15.91% in the first half of 2023 as stocks rally back from last year’s lows on optimism the Federal Reserve is nearing the end of its interest-rate hikes.

The S&P 500 also entered a "technical bull market" earlier this month with widening its advance from its Oct. 12 trough to 20%.

Big tech stocks are the gainers. Nvidia tops S&P 500 stocks with a nearly 190% gain. Meta Platforms soars over 138% while Tesla rises 112.5%.

Artificial intelligence (AI) has given $Nvidia(NVDA)$ a massive boost in the past six months as it has become evident that the chipmaker is going to play a mission-critical role in the proliferation of this technology.

Nvidia stock has soared roughly 190% this year, and that rally seems justified, as the boom in AI adoption has created a massive demand for the company's graphics cards. The AI-driven demand has turned Nvidia's fortunes around remarkably, with the company expected to clock nearly 60% revenue growth in the current fiscal year (2024) to $43 billion. Its earnings are expected to more than double to $7.78 per share from $3.34 per share in the prior fiscal year.

Piper Sandler analyst Harsh Kumar is feeling increasingly upbeat about $Nvidia Corp.(NVDA)$’s stock and positioning after taking a deeper dive into the company’s networking opportunity.

“To us, there are significant benefits when deploying a full-stack solution with GPUs, networking, and software specifically when it comes to accelerated data centers,” he wrote.

BofA Securities analyst Vivek Arya weighed in on the event as well, writing that Nvidia’s “strong position” in the networking market is “complementary to other AI hardware/software assets.”

$Tesla(TSLA)$'s stock earlier this month hit a record 13-session win streak, breaking a previous all-time run of 11 consecutive gains set in January 2021.

The stock has gained 112.5% so far this year, compared with an advance of about 15.9% for the S&P 500 index.

A major reason for such a significant rally of the EV stock is the recently signed agreements with auto giants General Motors and Ford, giving them access to its EV charging infrastructure. According to Piper Sandler's projections, Tesla has the potential to generate over $3 billion in charging revenue from non-Tesla owners alone by 2030, with the figure expected to reach $5.4 billion by 2032.

Musk believes a reason for the increase in TSLA is tied to the company's effort to perfect autonomous driving technology. He said, “Really the value of the company is primarily on the basis of autonomy. If you look at our total vehicle output, it’s almost 2 million vehicles this year or something like that. But that’s still only 2% of total vehicle production.”