Tech Stocks Surge as U.S. Economy Shows Strength Despite Nvidia Slump

Wall Street experienced gains led by the Nasdaq index, buoyed by a strong U.S. economic report despite Nvidia's underwhelming revenue forecast. Investors saw robust consumer spending and potential for a soft landing. Key players like Apple, Microsoft, and Meta drove the tech sector's rise, while the S&P neared a record high.

Wall Street's main indexes saw gains, led by the tech-heavy Nasdaq, following a report indicating a still robust U.S. economy. Despite Nvidia's largely in-line forecast disappointing investors, the market reaction remained positive overall.

The Commerce Department revealed stronger-than-expected economic growth, fueled by consumer spending. This, along with downward revisions to inflation, suggests potential for a soft landing, according to LPL Financial's chief economist, Jeffrey Roach.

While Nvidia's shares slid 3.2%, semiconductor peers and megacap customers like Microsoft, Meta, and Alphabet saw gains, lifting the Philadelphia SE Semiconductor index by 1.6%. Apple also surged over 2.4%, buoyed by Citigroup naming it its top AI pick. At 11:45 a.m. ET, the Dow Jones rose 289.54 points to 41,380.96, the S&P 500 gained 39.02 points to 5,631.20, and the Nasdaq climbed 182.80 points to 17,738.82.

(With inputs from agencies.)