(Reuters) – Nvidia became the world’s most valuable company on Tuesday, dethroning tech heavyweight Microsoft as its high-end processors play a central role in a scramble to dominate artificial intelligence technology.
Shares of the chipmaker rose 3.5% to $135.58, boosting its market capitalization to $3.335 trillion. This surge occurred shortly after surpassing Apple as the second most valuable company.
Microsoft’s stock market value was $3.317 trillion as its shares dipped 0.45%.
Apple’s stock slipped over 1%, leaving its value at $3.286 trillion.
Nvidia’s remarkable market value surge in the past year exemplifies Wall Street’s AI-driven optimism and frenzy.
Nvidia’s rally has driven the S&P 500 and Nasdaq to record highs. However, some investors fear AI optimism could fade amid technology spending slowdowns.
“It’s Nvidia’s market; we’re all just trading in it,” said Steve Sosnick, chief market strategist at Interactive Brokers.
Nvidia has emerged as the most traded company on Wall Street, with daily turnover averaging $50 billion. In contrast, Apple, Microsoft, and Tesla each see around $10 billion in daily trading volume, according to LSEG data. Nvidia now commands approximately 16% of total trading activity among S&P 500 companies.
Nvidia’s stock has nearly tripled so far this year, compared with a rise of about 19% in Microsoft shares, with demand for its top-of-the-line processors outpacing supply.
Tech giants Microsoft, Meta Platforms and Google-owner Alphabet are competing to build out their AI computing capabilities and add the technology to their products and services.
As Nvidia navigates its leadership position, the company’s focus on innovation, strategic investments, and market adaptation will play crucial roles in sustaining its growth trajectory and market leadership in the years ahead.
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