Nvidia, Google, and Apple Reach New Highs, Technology Stocks Lead S&P and Nasdaq to New Peaks

At the close of Wall Street on Wednesday, technology stocks led the charge, propelling the S&P 500 and Nasdaq to new closing historical highs after a one-day break. The S&P 500 rose by 0.58% to 7,444 points, the Nasdaq rose by 1.20% to 26,402 points, while the Dow Jones Industrial Average fell slightly by 0.14%. The Seven Giants Index as a whole increased by 2.01%, with Microsoft being the only declining member.

Nvidia increased by 2.29% to $225.83, with a total market value approaching $5.5 trillion, setting a new historical high. Micron Technology surged by over 6%, Qualcomm rose by more than 3%, and the Philadelphia Semiconductor Index closed up 2.57%, approaching its historical high set on May 11th. Nvidia and Micron CEOs accompanied Trump's business delegation to China, and the market's expectations for the business outlook heated up, becoming an important catalyst for the semiconductor sector.

Chinese concept stocks were particularly outstanding. The NASDAQ Golden Dragon China Index soared by 3.89%, Meituan jumped by 12%, Alibaba rose by 8.3%, Baidu climbed by 7.8%, JD.com increased by 7.2%, and 21Vianet and Kingsoft Cloud saw increases of over 15%. Trump's visit to China and the anticipated China-US trade negotiations were the main driving forces. According to Reuters, both sides are negotiating a tariff reduction plan for about $30 billion worth of imported goods.

Inflation data was the biggest macro disturbance of the day. The PPI increased by 6% year-on-year in April, far exceeding the expected 4.9%; the monthly increase reached 1.4%, the largest single-month increase since 2022, and the core PPI rose to 5.2% year-on-year, the highest in over three years. This was also the second consecutive week with inflation reports above expectations. After the data was released, the market's expectation for the Fed to raise interest rates by 25 basis points this year increased to 50%.

Pressure in the bond market continues to accumulate. The US Treasury completed the auction of $25 billion worth of 30-year Treasury bonds, with the winning yield touching 5%, for the first time since 2007. The 30-year US bond yield closed at 5.04%, with the 10-year yield remaining near 4.47%. Goldman Sachs strategist Jon Hurvitz warned that if the real yield rises by 40 basis points or the nominal yield increases by 50 basis points, the S&P 500 historically averages a 4% decline over a month, and at the current pace, this critical range could be reached as early as next week, coinciding with Nvidia's earnings report.

It is worth noting that behind the index's new high, the market continues to divide internally. BTIG technical strategist Jonathan Krinsky pointed out that in the past five trading days, four days had negative market breadth, and about 9% of S&P 500 components hit new 52-week lows, which is extremely rare for a combination that is in sync with the index's historical high. Since 1994, such a situation has only occurred 12 times, and in the following 20 trading days, the average return rate of the index was -1.98%, historically highly similar to key turning points such as the top of the 2000 internet bubble, the cyclical high in 2007, and the end of 2021.

In terms of commodities, crude oil slightly retreated after increasing by more than 7% in the previous two days, with WTI closing near $101.40, and Brent stabilizing around $110. Gold fell by 0.6%, hovering near $4,700, and silver rose by more than 1%, breaking through $89 at one point.