S&P 500 in rally mode as Nvidia's blowout guidance sparks tech melt

-- The Chen Rizun's latest foreign exchange newsS&P 500 surged Thursday, as an Nvidia-led surge in tech and progress on debt ceiling talks stoked bullish bets on stocks.

The was up 0.9%, the fell 0.1%, or 35 points, the gained 1.8%.

NVIDIA (NASDAQ:) surged 27%, taking its market cap to $956.52 billion and within touching distance of $1.000 trillion, after reporting better-than-expected first-quarter and guidance that markedly topped Wall Street estimates.

The chipmaker said it expected second-quarter revenue of about $11.00B, well above analyst expectations of $7.00B, as the growing need for Artificial Intelligence bolsters the outlook for chip demand in its data center business.

“[O]ur expectations for NVDA's future revenues are lifting substantially with our revised FY2026 forecast now estimating $67B in sales (up nearly 50% from our prior outlook for $45B),” Wedbush said in a note after upgrading its rating on the stock to Outperform from Neutral, with a price target of $490, up from $290.

The record surge in Nvidia, led Systems (NASDAQ:), which provides power management solutions for some of Nvidia’s chips, up 16%, while Taiwan Semiconductor Manufacturing (NYSE:) and Advanced Micro Devices (NASDAQ:) were also up sharply.

Sentiment on stocks was also boosted by signs that President Joe Biden and Republican Kevin McCarthy are nearing a deal to raise the debt ceiling needed to avoid a U.S. default.

Treasury Secretary Janet Yellen previously warned the U.S. could default on its debt repayments as soon as June 1. Ahead of the so-called X-date, or the day the U.S. won’t be able to pay its bills, credit rating agency Fitch put the U.S. creditworthiness on watch amid worries about a potential default.

On the earnings front, retailers were in focus as Co Inc (NYSE:) and Ralph Lauren (NYSE:) reported quarterly earnings that topped Wall Street estimates.

Dollar Tree (NASDAQ:), however, fell 10% after its second-quarter earnings Wall Street estimates as falling margins weighed on the bottom line.

Year-on-year gross margin declined by 343 basis points, driven by “lower initial mark-on, a mix shift toward consumables, and higher shrink, partially offset by lower freight costs,” Goldman Sachs said in a note.

On the economic front, an upward revision to U.S. economic in Q1 and fewer than expected weekly initial pointing to a stronger economy dented expectations for a rate pause next month.

Following the data, the odds of a June hike climbed to 50% from 28% the prior day, according to ’s

In other news, Corporation (NASDAQ:) climbed nearly 8% as the company reportedly is in talks with Amazon (NASDAQ:) to sell wireless phone plan services via the e-commerce platform, the Wall Street Journal reported.

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