Saturday, March 2, 2024

Nvidia is now worth as much as the whole Chinese stock market

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  • Nvidia is now worth the same as the whole Chinese stock market as defined by Hong Kong-listed H-shares, Bank of America chief investment strategist Michael Hartnett pointed out in a new note.
  • The company’s market cap has hit $1.7 trillion, the same as all Chinese companies listed on the Hong Kong Stock Exchange.
  • Nvidia’s stock soared 239% in 2023 and is up 41% in 2024, through Thursday.

Nvidia has grown at an eye-popping pace, to the point where it carries a valuation equal to that of China’s stock market as a whole, as defined by Hong Kong-listed H-shares.

In a new research note from Bank of America, the chief investment strategist Michael Hartnett noted that Nvidia’s $600 billion surge in value over the past two months had pushed its market cap to $1.7 trillion, on par with all Chinese-listed companies on the Hong Kong Stock Exchange combined. Hong Kong-listed shares are considered a good proxy for the Chinese market, as they meet international accounting standards and are directly accessible to brokerages worldwide.

The chipmaker behemoth’s market cap has nearly quadrupled since the start of last year. Its stock soared 239% in 2023, and is up 41% this year alone, through Thursday. Only four US public companies are worth more. 

Meanwhile, China’s economic malaise has sent stocks tumbling lower. Lackluster economic growth and a prolonged real-estate crash have weighed on the market. The country has also been dealing with deflation. The Hang Seng index, a benchmark for Hong Kong-listed Chinese stocks, has dropped 26% over the past year and 8% year-to-date.

But Hartnett noted there could be an opportunity for investors who can identify Chinese stocks with strong management, strong balance sheets, and strong earnings. He notes the precedent of Japan’s Nikkei collapse in the early 1990s, which then saw a select group of 15 companies possessing those characteristics rallying to a 400% bull market.

Correction: February 12, 2024 — An earlier version of this story misspelled the name of the Bank of America chief investment strategist. It’s Michael Hartnett, not Michael Harnett.

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