Why Meta-Platforms, Amazon, and Nvidia Are Rising Today

What happened

Shares of Metaplatforms (META 0.16%), Amazon (AMZN -0.91%)and Nvidia (NVDA 0.46%) all made gains this morning as investors continued their cautious optimism towards tech stocks that began last month.

As a result, Meta stock gained 2.3%, Amazon climbed 1.2% and Nvidia rose 2% as of 12:45 p.m. ET.

So what

Investors dipped their toes back into tech stocks last month after a months-long exodus from the sector. The tech-heavy Nasdaq Compound is down 20% since the start of the year, as investors have dealt with news of soaring inflation, Federal Reserve interest rate hikes and fears that the economy will shrink. finds itself in recession.

Image source: Getty Images.

But last month, some investors began to regain at least a little confidence in tech stocks again, as they likely thought most of the economic concerns and inflation concerns were already priced into falling corporate stock prices.

As a result, the Nasdaq Composite jumped 12% last month. Amazon and Nvidia benefited from the surge in tech stocks last month, as they gained 27% and 19% respectively. And it looks like investors are keeping that sentiment going for tech stocks today, helping to lift Meta, Amazon and Nvidia today.

Now what

What’s interesting about some of the stock price gains for these stocks today is that, in some cases, recent company news hasn’t been so good.

For example, Meta released its second-quarter results last week, in which revenue fell year-over-year for the first time ever. The company’s sales and earnings also missed consensus analyst estimates.

But investors can focus on the positives right now and instead look at Amazon’s second-quarter revenue growth that topped Wall Street’s average estimate and even factor in Applebetter than expected second quarter results that were released last week.

Additionally, Nvidia investors pushed the stock higher last week after the US Senate passed the CHIPS for America Act, which will provide subsidies and tax credits to certain semiconductor companies.

While it’s still unclear how much Nvidia will directly benefit, the bill could be a boon to the wider chip industry – with around $50 billion earmarked for chip companies. Nvidia investors seized on the fact that the U.S. chip industry as a whole could benefit and drove the company’s stock price up more than 9% last week.

While Meta, Amazon, and Nvidia investors are no doubt pleased with the recent price gains in these stocks, they also need to understand that there’s likely more volatility ahead for the tech sector.

With more Federal Reserve interest rate hikes potentially on the way and inflation still at 40-year highs, these stocks could undo some of the gains they have made recently.

Additionally, Nvidia will release its second-quarter financial results on August 24, and investors will want to closely monitor any changes in consumer spending that could affect the company’s gaming graphics processing unit sales, as well as any potential declines. company sales. important data center sales segment.

John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a board member of The Motley Fool. Randi Zuckerberg, former director of market development and spokesperson for Facebook and sister of Meta Platforms CEO Mark Zuckerberg, is a board member of The Motley Fool. Chris Neiger holds positions at Apple. The Motley Fool holds positions and recommends Amazon, Apple, Meta Platforms, Inc. and Nvidia. The Motley Fool recommends the following options: $120 long calls in March 2023 on Apple and short calls $130 in March 2023 on Apple. The Motley Fool has a disclosure policy.

Comments are closed.