Tech Stocks Soar on AI Hype, But Some Investors Question Overvaluation

NVIDIA's stock has hit a record high due to strong earnings and the potential of AI. However, some investors are concerned about its high price-earnings ratio and other metrics. Other tech stocks, including Amazon, Apple, Google, Meta, Microsoft, and Tesla, have also seen gains, but not to the same extent as NVIDIA. The AI-driven trend has led to a lopsided market, with these seven stocks gaining significantly more than the other 493 in the S&P 500.

Alphabet's stock has seen a surge in May due to its involvement in AI technology, but it is still below its all-time high of $150 in early 2022. Meta Platforms' stock has been steadily increasing since October 2022 and is now above the 50-month moving average, but it still has a long way to go to surpass its all-time high of just above $380 in 2021. The tech sector is currently more than 3 standard deviations above its 50-day moving average, which raises questions about how much longer this rally can continue.

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