Nvidia’s rise and China’s struggles

  • Nvidia’s market cap is now equal to the entire Chinese stock market
  • Nvidia’s market cap rise in the last two months equals Tesla’s entire market cap
  • Nvidia has soared 228% in the last 52 weeks while the Hang Seng has dropped 26%
  • Bank of America strategist compares China’s struggles to Japan’s in the 1990s
  • Small portfolio of ‘best of breed’ stocks can be profitable in a deflationary bear market
  • Positioning in the US stock market is flipping from a tailwind to headwind
  • Bubble won’t stop until 10-year yields, adjusted for inflation, are above 2.5%
  • Bank of America’s rules are closing in on sell signals

Nvidia’s market capitalization has reached the same value as the entire Chinese stock market, represented by the H shares of the Hong Kong stock market. In just the last two months, Nvidia’s market cap has risen by $600 billion, which is equivalent to the entire market cap of Tesla. Over the past year, Nvidia’s stock has soared by 228%, while the Hang Seng in Hong Kong has dropped by 26%. Bank of America strategist, Michael Hartnett, compares China’s current struggles to Japan’s in the 1990s. He suggests that in a deflationary bear market, a small portfolio of ‘best of breed’ stocks with strong management, balance sheets, and EPS growth can be highly profitable. However, he also notes that positioning in the US stock market is shifting from a tailwind to a headwind. Hartnett believes that a bubble won’t stop until the 10-year yields, adjusted for inflation, are above 2.5%. Bank of America’s rules are also indicating potential sell signals, such as cash levels reported in its fund manager survey and inflows to risky assets. The S&P 500 index closed at a record high for the ninth time this year and has gained 22% over the last year.

Public Companies: Nvidia (NVDA), Tesla (TSLA)
Private Companies:
Key People: Michael Hartnett (Bank of America strategist)

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Factuality Level: 3
Justification: The article contains irrelevant information about Nvidia’s market cap and comparison to the Chinese stock market. It also includes the personal opinion of Michael Hartnett and his comparison between China’s struggles and Japan’s in the 1990s. The article lacks in-depth analysis and provides limited context.

Noise Level: 3
Justification: The article contains some relevant information about the rise of Nvidia and its comparison to the Chinese stock market. However, it lacks depth and analysis, and the inclusion of unrelated information about the US stock market and Bank of America’s rules detracts from the overall coherence and focus of the article.

Financial Relevance: Yes
Financial Markets Impacted: The article mentions the Chinese stock market and the U.S. stock market.

Presence of Extreme Event: No
Nature of Extreme Event: No
Impact Rating of the Extreme Event: No
Justification: The article discusses the market cap rise of Nvidia and the struggles of the Chinese stock market, but does not mention any extreme events.

Reported publicly: www.marketwatch.com