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Nvidia is the top performer of the S&P 500 and Nasdaq 100 for the first half of 2023.
Justin Sullivan/Getty Images
Friday’s session marked the end of the first half of 2023—and the six-month stretch was one for the history books.
Silicon Valley Bank and Signature Bank failed early in the year, giving investors a jolt of fear, but attention quickly shifted to tech stocks amid excitement over artificial intelligence. All that came amid rising tension between the U.S. and China, Russia battling Ukraine, and the Federal Reserve fighting inflation by raising interest rates—sparking concern about a potential recession.
“Investors have had a lot to contend with thus far in 2023. Moderating economic growth, persistent inflation, volatile interest rates, falling profits, stress in the banking sector, war in Ukraine, and the debt ceiling debate all combined to weigh on sentiment,” said John Lynch, chief investment officer for Comerica Wealth Management. “Nonetheless, large cap equities and megacap tech names have jumped higher, providing a degree of relief for investors.”
Not all stocks have done so well. Here is a look at the best- and worst-performing stocks in the
Dow Jones Industrial Average
,
S&P 500
,
and
Nasdaq 100
after the final trading session for the first half of 2023.
Best Performers
The S&P 500 and the Nasdaq 100 share the same top-performing stock:
Nvidia
.
The chip maker (ticker: NVDA) has soared 189% this year to $423.02, which was the stocks best first half on record, according to Dow Jones Market Data.
Most of the gains stem from excitement around the future of AI.
Nvidia
‘s chips are used to power the computers used for generative AI.
“NVDA in best position to transform the $1 trillion non-accelerated data center market with its full stack artificial intelligence platform,” Vivek Arya, BofA Securities analyst, wrote in a June research note. He rates the stock as a Buy with a $500 price target.
The average 12-month price target among 49 analysts tracked by
FactSet
is $457.56.
Salesforce
(CRM) was the best-performing stock in the Dow for the first half of the year, with the stock jumping 59% to $211.26. The cloud-based software provider, another company riding the AI wave, also had its best first half on record.
In March, Salesforce unveiled Einstein GPT to provide generative AI tools across its software business. In June, it announced AI Cloud, customer-relationship- management software that combines AI with data from multiple sources “to provide trusted, open, real-time generative AI that is enterprise ready.”
“We estimate the AI monetization opportunity to reach $800 billion over the next decade with the Game of Thrones battle taking place across the tech space and CRM’s key move in incorporating generative AI solutions for improved efficiencies across its platform puts the company in an enviable position to capitalize on the AI gold rush,” Wedbush analyst Dan Ives wrote in a research note June 13. He rates the stock as Outperform with a $240 price target.
Worst Performers
Walgreens Boots Alliance
(WBA), which has fallen 24% to $28.49 this year, has fallen the most among Dow stocks. The stock has fallen about 9% this week alone.
This week, the pharmacy chain cut its profit outlook for the year, and said that profits in its latest quarter were hit by lower volumes of Covid-19 testing and vaccinations. Walgreens also warned that shoppers have become “more cautious” and are looking to spend more on value products.
Advance Auto Parts
(AAP), another consumer-facing company, was the weakest stock in the first half of 2023 for the S&P 500. Shares of the automotive products retailer have dropped 52% this year to $70.30 each.
In May, the company reported first-quarter earnings of 72 cents a share, less than one-third of the Wall Street consensus forecast for $2.56. Advance Auto Parts’ full-year earnings forecast was disappointing and management cut the dividend.
“We expect the competitive dynamics we faced in the first quarter to continue, resulting in a shortfall to our 2023 expectations,” Chief Executive Tom Greco said in the company’s earnings release.
JD.com
(JD) led the losers in the Nasdaq 100. American depositary receipts of the Chinese e-commerce company have fallen 39% in 2023, making it the stock’s worst first half on record.
JD.com
reported an earnings beat for its first quarter in May. However, the stock has been tumbling, with traders having concerns about a new wave of Covid-19 cases in China. These cases came after the country implemented strict lockdowns that impacted both China’s and the global economy.
Investors were also concerned over the future of Chinese stocks on Friday, following new data that showed China’s economy is struggling.
Write to Angela Palumbo at [email protected]
Source: https://www.barrons.com/articles/stocks-first-half-biggest-gainers-losers-10549f23?siteid=yhoof2&yptr=yahoo