Nasdaq-100 Hits Record High as NVIDIA Surpasses Microsoft in Market Value

On the evening of June 25, the U.S. stock market witnessed a significant shift, with technology stocks leading the charge. The Nasdaq-100 index reached an all-time high during intraday trading, peaking at 22,329.23 points, while the Nasdaq index briefly surpassed the 20,000-point mark. Notably, NVIDIA's stock surged by over 3%, pushing its market capitalization above that of Microsoft, making it the company with the highest market value globally.

This surge in technology stocks comes as investment management companies are rapidly divesting from European assets and refocusing on the U.S. market. According to recent reports from Goldman Sachs and Barclays, the shift in investment strategy is driven by concerns over the European market's lack of near-term catalysts and insufficient growth momentum. The strong euro, weak economic growth, and high oil prices are all factors that are weighing on the earnings of European listed companies.

In addition to the market movements, a major regulatory change is brewing in the U.S. stock market. Major U.S. securities exchanges are in discussions with the Securities and Exchange Commission (SEC) to relax regulatory requirements for listed companies. The goal is to attract more high-valued startups to the capital market. The proposed changes include reducing information disclosure obligations, lowering listing costs, and making it more difficult for small shareholders to initiate shareholder actions.

These discussions have been ongoing for several months and align with the agenda of the current U.S. administration, which has pledged to ease regulations to stimulate economic growth. Market experts view these talks as a significant step towards regulatory reform since the passage of the JOBS Act in 2012. The proposed changes aim to make the public market more attractive to companies, thereby democratizing the listing process.

One of the key areas of discussion is the reform of the proxy voting process, which involves the information that companies must disclose to shareholders to enable them to vote on company matters. Proposed changes include limiting the ability of small, activist shareholders to initiate proxy contests, reducing the space for minority shareholders to repeatedly submit proposals, and relaxing the disclosure requirements for preliminary proxy materials.

Another proposed reform is to lower the costs associated with listing and maintaining a listing, making it more affordable for companies to go public. Additionally, discussions are underway to ease financing restrictions for companies that go public through Special Purpose Acquisition Companies (SPACs). SPACs allow companies to go public indirectly by merging with a listed shell company, bypassing the traditional IPO process. In recent years, the SEC has tightened regulations on SPACs, and the proposed changes aim to provide more flexibility for companies using this route.

However, some analysts warn that relaxing information disclosure requirements and lowering listing costs could come at the expense of investor protection. When regulations are eased, investors may face increased potential losses. Despite these concerns, the proposed changes represent a significant shift in the regulatory landscape of the U.S. stock market, aimed at attracting more high-valued startups and fostering economic growth.