S&P 500 Climbs as Nvidia and TSMC Drive Tech Stock Rally, Retail Data Strong

Wall Street Gains as Chip Stocks Surge and Retail Data Impresses

U.S. stocks rose on Thursday, with the S&P 500 and Dow Jones reaching new intraday highs, driven by strength in semiconductor stocks and positive retail sales data. Taiwan Semiconductor Manufacturing Co. (TSMC) delivered better-than-expected quarterly results, while U.S. retail sales also exceeded forecasts, reinforcing confidence in the resilience of the U.S. economy.

At 15:37 GMT, the Dow Jones Industrial Average is trading 43219.97, up 142.27 or +0.33%. The S&P 500 Index is at 5858.85, up 16.39 or +0.28% and the Nasdaq is trading 18452.76, up 85.68 or +0.47%.

Broad-Based Index Performance

The S&P 500 and Dow Jones both experienced gains, buoyed by TSMC’s strong earnings and a 0.4% rise in September retail sales. TSMC, the world’s largest contract chipmaker, posted a 54% profit increase and projected further growth in the fourth quarter due to surging demand for artificial intelligence (AI) chips. This positive outlook pushed the company’s U.S.-listed shares up by 11.7%, contributing to broader market optimism.

The Philadelphia Semiconductor Index rose 2.7%, as the entire chip sector benefitted from renewed interest in AI-driven growth. Meanwhile, retail data showing continued consumer strength reinforced investor confidence, as higher sales figures offset concerns about an economic slowdown.

Sector-Wise Breakdown

The Information Technology sector led the S&P 500’s 11 sectors with a 1.3% rise. Nvidia saw a 3.6% jump, reaching a new record high after TSMC’s forecast revitalized AI chip demand. Other major chip players also gained, with Broadcom advancing 4% and Intel rising 1.9%.

On the other hand, healthcare stocks weighed on the Dow Jones, as Elevance Health fell sharply by 14.2% after lowering its full-year profit outlook. UnitedHealth and Centene followed suit, with declines of 1.7% and 9%, respectively, dragging down the overall performance of the healthcare sector.

Stock-Specific Highlights

TSMC’s stellar performance had ripple effects across the semiconductor industry, propelling Nvidia, a key AI chip player, to a new intraday high of $140.89. Nvidia, which has climbed over 180% year-to-date, continues to benefit from massive demand for its AI-focused products, with companies like Microsoft, Meta, and Google making substantial investments in its GPUs.

Meanwhile, Travelers Companies gained 7% after surpassing third-quarter profit expectations, while Netflix dropped 1.5% ahead of its earnings report. On the downside, EV-maker Lucid tumbled 14% following its warning of a larger-than-expected Q3 loss and a public offering announcement.

Market Forecast

The short-term outlook remains cautiously bullish, supported by solid retail sales and TSMC’s positive earnings. However, concerns over high valuations and upcoming earnings reports could trigger volatility, especially ahead of the U.S. presidential election.

While consumer spending and strong economic data suggest continued market strength, stretched valuations and potential headwinds from the healthcare sector may temper gains in the near future. Traders should stay alert for upcoming earnings and Federal Reserve policy updates.