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Nvidia is the new king of the stock market

Five years ago it wasn’t even in the top 60 stocks in the S&P 500 but the launch of ChatGPT has changed everything

Nvidia briefly this week became the most valuable stock in the world. Photograph: Getty

Proinsias O'Mahony's face
Proinsias O'Mahony
Sun Jun 23 2024 - 06:15

Fuelled by the artificial intelligence (AI) boom, Nvidia dethroned Microsoft and Apple and became the world’s most valuable company on Tuesday.

It didn’t last, with Microsoft regaining top spot by Thursday. Still, it’s been a long time since anyone other than Microsoft or Apple has led the US market. Oil giant Exxon Mobil was the last such company, way back in 2013.

Unlike Microsoft and Apple, Nvidia is not a household name outside of the financial world. Just five years ago, it wasn’t even in the top 60 stocks in the S&P 500, but the launch of ChatGPT in late 2022 changed everything.

Shares have risen more than 1,100 per cent since October 2022, driving the AI chipmaker’s market capitalisation from around $300 billion (€354.8 billion) to $3.34 trillion.

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The pace of Nvidia’s ascent is unprecedented. Bespoke Investment notes that for Apple and Microsoft, it took 1,044 and 945 days, respectively, for their market caps to go from $2 trillion to $3 trillion. Nvidia got there in 96 days. Since April 19th, says Bespoke, Nvidia’s market cap has increased by $1.4 billion an hour.

Yes: $1.4 billion an hour.

Investors have never witnessed growth like this.

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