Nvidia quickly rose to become one of the biggest companies in the U.S. On Tuesday, the chip maker became the most valuable company in the country.
Nvidia shares NVDA, +3.51% rose 3.5% on Tuesday, making the company bigger than Microsoft Corp. MSFT, -0.45% by market value at the end of the day. Microsoft had a market cap of $3.32 trillion, Nvidia had $3.34 trillion, and Apple Inc.’s AAPL, -1.10% was third with $3.29 trillion.
Tuesday was the first time that Nvidia was the biggest during the day, and that trend continued until the end of the day, making Nvidia the new market-cap leader.
According to Dow Jones Market Data, Nvidia wasn’t even in the top 20 five years ago, so its rise is even more impressive. It was ranked fifth by market cap last year and tenth the year before that.
Dow Jones Market Data shows that since 2001, only five other companies have been able to say they were the most valuable in the U.S. Those are Apple, Amazon.com Inc. (AMZN, -0.68%), Exxon Mobil Corp. (XOM, +0.94%), and GE, which used to be General Electric. During that time, Apple was in first place the longest, while Amazon was in first place for only 13 sessions in 2019.
In the past week, there has been some movement among the top three. At the end of Thursday, Apple had passed Microsoft.
Over the past year or so, Nvidia shares have gone through the roof as the company has proven to be the biggest winner in the search for artificial intelligence. The price of Nvidia stock has gone up 174% so far this year and 217% over the last 12 months.
This year, Microsoft stock has gone up 19% and Apple stock has gone up 11%.
So far this year, Nvidia’s stock has been a big part of the S&P 500 index’s SPX performance. Citi strategists said late Monday that Nvidia was responsible for 5.1 percentage points of the 14.6% rise in the index so far, which is almost as much as the change in performance from the 493 index components that aren’t from the “Magnificent Seven” large tech companies.
The rise in Nvidia’s market value has broad effects. For example, the Technology Select Sector SPDR ETF XLK will have to sell Apple shares and buy almost $10 billion worth of Nvidia stock to match the new weightings of the S&P Technology Select Sector Index that it tracks.
