Nvidia-Led AI Capex Fuels Market Rally as Yields Near 5%
NVDA•Wall Street strategists highlight that AI capital expenditure by hyperscalers, led by expectations from Nvidia, is driving market gains despite 10-year yields climbing above 4.5% and 30-year yields above 5%. A pure-play space ETF of 11 aerospace firms has more than doubled in 2.5 months, underscoring demand for tech bottleneck investments.
1. AI Capex Driving Market Resilience
Market strategists emphasize that hyperscalers’ insatiable demand for AI infrastructure, spearheaded by Nvidia’s guidance, has overshadowed concerns over rising interest rates and inflation, sustaining equity gains through the first half of the year.
2. Interest Rates Reach New Highs
Yields on the 2-year, 10-year and 30-year Treasury climbed past 4%, 4.5% and 5% respectively in recent weeks, yet equity markets remained buoyant as investors bet on durable AI-led growth rather than fixed-income returns.
3. Space ETF Surges on Aerospace Bets
A recently launched pure-play space ETF comprising 11 aerospace firms has more than doubled in value since its inception 2.5 months ago, reflecting growing investor appetite for specialized technology sectors and planned additions like a potential SpaceX listing.
