Nvidia’s record close sent its market value past $5 trillion on Friday, capping a 4.3 percent jump and helping extend a chip-led rally that had already pushed Intel up 24 percent in its best day since 1987. The move was less about one company than about money rushing back into AI hardware before next week’s earnings from the hyperscalers.
That surge built on a market that has been grinding higher for weeks. Global equities entered the week near records, with the S&P 500 up almost 10 percent since the end of March, while the Nasdaq has gained 15 percent in April and is on pace for its best month since April 2020. Beneath the enthusiasm, though, the rally is being powered by expectations that the Federal Reserve could cut rates again this year and by a belief that the AI buildout still has room to run.
For investors in semis, that has meant broad gains across the group, with AMD up 14 percent and Qualcomm up 11 percent as the chip trade widened beyond Nvidia. But the same momentum is drawing skepticism: Warren Buffett’s preferred valuation gauge has climbed to 227 percent, a level the Oracle of Omaha once called "playing with fire", and the S&P 500’s price-to-earnings ratio is now above 28, far richer than its long-run average.
That leaves the next test with the earnings wave from Apple, Amazon and Alphabet, after Friday’s chip surge and a market that has already shrugged off stalled Iran talks. If those reports confirm that AI spending is still accelerating, the rally could keep stretching; if not, the crowded trade and elevated valuations give traders little cushion.
