Overnight, the three major U.S. indexes collectively closed higher, with the S&P 500 index and Dow Jones setting new record highs. Statistics show that this is the 44th time the S&P 500 index has hit an all-time high this year.
In terms of the components of the S&P 500 index, chip giant$NVIDIA (NVDA.US)$ and software giant $Palantir (PLTR.US)$ , one of the largest clean energy suppliers in the USA $Constellation Energy (CEG.US)$ has doubled its stock price this year; $GE Aerospace (GE.US)$ Ethernet switch giant $Arista Networks (ANET.US)$ Cloud giant $Oracle (ORCL.US)$ Semiconductor giant $Broadcom (AVGO.US)$ Social media giant $Meta Platforms (META.US)$ All rose more than 67%, it is worth noting that these companies are all big winners in the AI wave.
It is worth noting that in the past decade, there have been a large number of ten-bagger stocks in the US stock market, bringing handsome returns to US stock investors.
Among them, US technology stocks have become the most important driving force. Among them, the "AI chip king" $NVIDIA (NVDA.US)$ has soared by as much as 300% in the past decade, $Advanced Micro Devices (AMD.US)$ has risen by as much as 57 times in the past decade, $Broadcom (AVGO.US)$ then up to 28 times; $Tesla (TSLA.US)$Please use your Futubull account to access the feature.$Amazon (AMZN.US)$Please use your Futubull account to access the feature.$Taiwan Semiconductor (TSM.US)$Please use your Futubull account to access the feature.$Netflix (NFLX.US)$ Has multiplied more than 10 times; $Apple (AAPL.US)$Please use your Futubull account to access the feature.$Microsoft (MSFT.US)$ also in the process of competing for the title of the world's largest market cap, has experienced a wave of strong market performance, all rising nearly 10 times. In addition, the global pharmaceutical leader $Eli Lilly and Co (LLY.US)$ has multiplied over 16 times in the past decade, with a market cap approaching 900 billion US dollars.
Can the US stock market continue to rise?
Due to signs of a strong U.S. labor market, resilient economy, and loose monetary policy, Wall Street's optimism towards global equities is increasing.
Goldman Sachs analyst David Kostin recently raised expectations for the future one-year earnings growth of the S&P 500 index, as he anticipates that a robust macro outlook will drive profit margin growth. Kostin has raised the expected level of the S&P 500 index for the next 12 months from 6000 points to 6300 points, up 5%.
According to 21st Century Business Herald, Zhang Chi, Chief Analyst of Fangde Securities, mentioned that the recent US chip sector has shown signs of stabilizing, and Nvidia's latest chips are still in short supply. The S&P 500 index had previously hit a new high, but recently faced a significant rise in Chinese assets, draining some liquidity, while the US is also approaching elections, with overall cautious funds, the main opportunity for the US stock market may be in early November.
It is worth noting that as the US stock market rallies stronger, one of Wall Street's largest bears has also 'surrendered'.
Since October 2022, JPMorgan's strategists have been bearish on the US stock market. However, according to a report released by the bank's Chief Global Equity Strategy, Dubravko Lakos-Bujas, on Tuesday, this situation seems to be changing. Although this analyst has not updated the year-end target price of 4200 points for the S&P 500 index (which implies a significant decline of 27% from the current level), he certainly advised investors not to be overly bearish on the market.
However, they are not completely bullish on the US stock market. The strategist warns that the November presidential election could bring volatility to the market, depending on the election results, and that falling interest rates could adversely affect corporate profits, especially in the financial sector.
Renowned economist Roubini, known as the 'Dr. Doom', has long been skeptical about the rise of US stocks, but is quite positive about the rise of American tech giants. He mentioned that
The story of tech giants is accurate because artificial intelligence will fundamentally change the world, starting with the USA. However, this will not happen overnight. In the long run, investing in securities related to technology and artificial intelligence is a good investment, but there will be significant fluctuations due to inflation, interest rates, and possible economic changes. Technology is a long-term investment.
However, investors need to be aware that the US presidential election is also an uncertainty factor in the market. According to the 21st Century Business Herald, looking ahead, the chief analyst at Fund Securities predicts that after the US election, some funds may start to replenish their positions in US stocks, and he remains optimistic about the market at the end of the year following the US election. Combining recent trends, the technology sector has been consolidating for some time and is expected to make a comeback, although the valuation is not cheap, the profit growth rate remains fast, and the overall uptrend may be maintained. With the resilience of the US economy and the drive of the technology sector, US stocks may continue to rise.
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