- The Dow Jones is to replace Intel Stocks with NVIDIA on November 8th.
- Intel stocks have fallen 51% in 2024 so far while NVIDIA is 181% higher.
- The NVIDIA reserve stock split in 2024 has made the stock more affordable.
- Intel’s Earnings Per Share has fallen significantly.
Dow Jones (USA30) – NVIDIA To Be Added On November 8th!
The Dow Jones did particularly well on Friday witnessing similar gains to the NASDAQ and outperforming the SNP500. The price movement is largely due to the US employment data which indicated the latest weather conditions did have an impact on the employment sector. Due to this, interest rate cuts remain likely for both Thursday evening and December.
The Dow Jones has taken the decision to remove one of its worst performing stocks, Intel Corp. The decision was taken as the company’s latest earnings per share fell to -0.46 USD. The stock is also trading more than 51% lower in 2024 and at its lowest price in more than 10 years. However, investors should note that the stock only holds 0.34% weight of the Dow Jones. Though, due to the Dow Jones Calculations, NVIDIA is likely to hold a higher exposure to the overall price. With its addition to the Dow Jones, NVIDIA is now included in all 3 major US indices.
NVIDIA is due to release their quarterly earnings report on November 20th after market close. The market expects NVIDIA’s Earnings Per Share to rise from $0.68 to $0.74 while the company’s revenue is due to increase to $32.92 billion. Analysts expect the revenue of the company to rise to an all-time high due to the recent AI trend. As the Dow Jones confirmed that NVIDIA will be added to the index, the price of NVIDIA stocks rose by 2.30% in pre-market hours. In addition to this, the Dow Jones’ price also rose by 0.32%.
The price movement of NVIDIA’s stock will largely depend on the outcome of the US Election as well as the upcoming earnings data. If the company is able to obtain a higher earnings per share as well as revenue, the stock is likely to obtain further upward support. Also, investors are hoping the new President will not add tariffs to products related to chips and AI. However, for the Dow Jones, the frequency of upcoming interest rate cuts will be the main price driver.
Michalis Efthymiou
Market Analyst
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