Nvidia Achieves Historic S&P 500 Dominance Amid AI-Driven Rally

Nvidia has cemented its position as the largest single-stock weight in S&P 500 history, closing Monday with a staggering $4.5 trillion market valuation. The chipmaker's unprecedented influence follows a relentless rally—239% in 2023, 171% in 2024, and 36% year-to-date in 2025—fueled by insatiable demand for its AI processors.

Wall Street remains overwhelmingly bullish, with nearly 90% of analysts maintaining buy ratings despite a frothy 59x trailing P/E ratio. "The AI Gold rush shows no signs of slowing," observed one trader, noting Nvidia's chips have become the picks and shovels of the generative AI boom.

D.A. Davidson's Gil Luria strikes a cautionary note, flagging China exposure as a critical vulnerability. While direct sales to China sit in the low double-digits, shadow supply chains—via overseas Chinese entities and gray-market resellers—create material regulatory risk. Luria's $135 price target implies a 26% downside from current levels.