Week of 05/22-05/26 Tech stocks and AI lead the market, debt ceiling decision pending

The stock market rallied this week with the Nasdaq 100 (NDX), Dow Jones Industrial Average (DJIA), and the S&P 500 (SPX) all closing green on Friday. The major topics this week were Nvidia Corporation (NVDA) earnings focusing on artificial intelligence and debt ceiling deal still up in the air.

The GPU manufacturer Nvidia released earnings after hours on Wednesday sending the stock surging up 26% in a matter or minutes. Nvidia had just announced last week the integration of the RTX 4060 series graphics cards into their lineup of GPU's which also sent the company soaring 10% in two days. Nvidia did not only crush their Q1 earnings expectations, but established a strong growth sentiment in investors as the company explained their role in the next generation AI. The demand for their products is exponentially increasing as generative AI grows which allows users to quickly process or generate new content that includes 3D models, text, sounds, images, animations, and many other types of data. This spike in the stock's price also caused other AI related stocks to surge after hours. Analysts upgraded NVDA stock price target to an average of 450 dollars per-share.

Debt ceiling worries have been lingering for the last couple weeks as the decision will have an effect on the where the stock market points next. Ongoing meetings, discussions, and negotiations have not come to a conclusion and in result extending the deadline from June 1st to June 5th. Treasury Secretary, Janet Yellen, has indicated the importance of the decision multiple times by stating that if the debt limit is not raised soon, it will cause severe hardship due to the catastrophic default on the national debt. The debt ceiling deal next week will determine the actions the Federal Reserve will have to take to manage the economy.