Dow Jones Industrial Average rebounds as investors hope for government shutdown solution
- The Dow Jones is holding steady above 47,000 as investors look for an end to the federal shutdown.
- Equity markets retreated last week as market risks on multiple fronts continue to simmer.
- A government funding solution means the flow of official datasets should resume, for better or worse.
The Dow Jones Industrial Average (DJIA) steadied its grip on Monday, starting the new trading week holding near the 47,000 major handle and lifting around 370 points. Equity markets pulled back last week as the AI tech rally shows signs of unwinding, or at least taking a breather, and investors are looking for an end to what has become the longest US government funding shutdown in history.
Following a week of exhaustion-based pullbacks, AI tech leaders are back at the forefront as investors await meaningful details on a possible funding gap for federal operations to resume. The funding bill, which only keeps the US government open through January, will put markets on a collision course with further political unease in a few months’ time.
Hopes for a temporary funding solution reignite investor hopes
The longest US government shutdown in history has pushed consumer confidence to its lowest readings on record, according to data from the University of Michigan last week. A lack of official numbers on inflation and employment has also pushed investors to increase their reliance on volatile public datasets.
This week would have seen the release of the latest US Consumer Price Index (CPI) and Producer Price Index (PPI) inflation datasets, but there is hope that the US House of Representatives will push a pending temporary funding measure through in time to get a fresh round of inflation and employment statistics before the Federal Reserve’s (Fed) next interest rate decision on December 10. At the latest interest rate decision, Fed Chair Jerome Powell expressed unease about making further interest rate moves amid a lack of critical government data, sending December rate cut hopes into a tailspin.
Dow Jones daily chart
Nvidia FAQs
Nvidia is the leading fabless designer of graphics processing units or GPUs. These sophisticated devices allow computers to better process graphics for display interfaces by accelerating computer memory and RAM. This is especially true in the world of video games, where Nvidia graphics cards became a mainstay of the industry. Additionally, Nvidia is well-known as the creator of its CUDA API that allows developers to create software for a number of industries using its parallel computing platform. Nvidia chips are leading products in the data center, supercomputing and artificial intelligence industries. The company is also viewed as one of the inventors of the system-on-a-chip design.
Current CEO Jensen Huang founded Nvidia with Chris Malachowsky and Curtis Priem in 1993. All three founders were semiconductor engineers, who had previously worked at AMD, Sun Microsystems, IBM and Hewlett-Packard. The team set out to build more proficient GPUs than currently existed in the market and largely succeeded by late 1990s. The company was founded with $40,000 but secured $20 million in funding from Sequoia Capital venture fund early on. Nvidia went public in 1999 under the ticker NVDA. Nvidia became a leading designer of chips to the data center, PC, automotive and mobile markets through its close relationship with Taiwan Semiconductor.
In 2022, Nvidia released its ninth-generation data center GPU called the H100. This GPU is specifically designed with the needs of artificial intelligence applications in mind. For instance, OpenAI’s ChatGPT and GPT-4 large language models (LLMs) rely on the H100’s high efficiency in parallel processing to execute a high number of commands quickly. The chip is said to speed up networks by six times Nvidia’s previous A100 chip and is based on the new Hopper architecture. The H100 chip contains 80 billion transistors. Nvidia’s market cap reached $1 trillion in May 2023 largely on the promise of its H100 chip becoming the “picks and shovels” of the coming AI revolution. In June 2024, Nvidia's market capitalization crossed the $3 trillion mark.
Long-time CEO Jense Huang has a cult following in Silicon Valley and on Wall Street due to his strict loyalty and determination to build Nvidia into one of the world’s leading companies. Nvidia neary fell apart on several occasions, but each time Huang bet everything on a new technology that turned out to be the ticket to the company’s success. Huang is seen as a visionary in Silicon Valley, and his company is at the forefront of most major breakthroughs in computer processing. Huang is known for his enthusiastic keynote addresses at annual Nvidia GTC conferences, as well as his love of black leather jackets and Denny’s, the fast food chain where the company was founded.
Author
Joshua Gibson
FXStreet
Joshua joins the FXStreet team as an Economics and Finance double major from Vancouver Island University with twelve years' experience as an independent trader focusing on technical analysis.
