Nvidia and TSMC saw significant gains in market value in October, driven by sustained demand for artificial intelligence (AI) chips. Nvidia’s market cap surged 9.3% to $3.26 trillion, propelled by its advanced supercomputing AI chips increasingly adopted by companies to enhance operations. Taiwan Semiconductor Manufacturing Company (TSMC), Nvidia’s key supplier, experienced a 6.5% market value increase, reaching $832.8 billion. This growth followed TSMC’s better-than-expected third-quarter earnings and a positive AI outlook.
Conversely, Apple’s market value faced a 3% decline, momentarily losing its position as the top global company by market capitalization to Nvidia. Apple’s market cap fell to $3.4 trillion amid concerns over tepid growth forecasts and weaker sales in China before recovering. Meanwhile, Meta Platforms and Microsoft reported market cap declines in October. Both companies cited rising AI expenses as a reason for investor concern.
UBS Global Wealth Management’s Mark Haefele remained optimistic about AI investments. He advised investors to view short-term market fluctuations as opportunities, forecasting substantial earnings growth for AI-related stocks. “We continue to favor select semi names and big tech, and we expect our AI portfolio to deliver 35% earnings growth in 2024 and 25% in 2025,” Haefele stated.
Asian tech giant Tencent Holdings experienced a 9% drop in market value to $483 billion. This decline stemmed from broader concerns, including disappointing economic data and heightened geopolitical tensions in China. Investors also awaited further clarity on government measures intended to stabilize the market.
Additionally, U.S. pharmaceutical firm Eli Lilly reported a 6.45% drop in market value, decreasing to $787.6 billion. The dip followed quarterly earnings that missed Wall Street expectations for weight-loss and diabetes drugs, leading to a significant decline in share price.
Featured image courtesy of Nikkei Asia
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