Nvidia Corp. shares rebounded from the previous trading week’s selloff, as many of the chip maker’s investors are becoming more bullish on artificial intelligence. 

Nvidia stocks rallied 15%

The silicon chip giant’s stock rallied 15% during the last five days from its lowest of the past week. The stock price has improved from a low of $756 to a little more than $880, which is also its best performance on a weekly basis for almost a year.

The stock has added $320 billion to Nvidia’s market cap. If we look at the last week alone, the chip behemoth has added a market cap bigger than that of many larger brands like Costco. 

Market analysts are speculating that the surge may be coming from the heavy pledges for investment in AI by firms like Microsoft, Meta Platforms, and Alphabet, which have said that they will be investing billions in the tech.

Investments in the AI sector finally reach chipmakers

When Meta recently announced its heavy spending in artificial intelligence infrastructure during its first quarter earnings call, it freaked out the investors, and the selloff sagged Meta’s stock price, as it was a way the company will be spending money for a long period and returns are still far.

At the same time, this news and many others like it from other tech giants are playing wonders for Nvidia because the revenue will start flowing towards them. And what else do investors want, if not early profits?

Nvidia has already performed very well during the past year, as its stock gained more than 200%, which makes Nvidia a potential winner in this race. Some analysts are expecting Nvidia stock to remain mostly bullish for the next year, and they are speculating that it may gain 20% to 21% more during this time, which will surge the price near $1000, as Nvidia is already in a dominant position over its competitors like IBM. 

The interesting fact is that now trillion dollar stocks are showing hyper volatility, which is the nature of penny stocks. Nvidia, whose products are considered the gold standard in the chip industry, is currently dominating the semiconductor sector, though the entire chip industry is bullish as stocks are climbing.

But no other company has tied the Wall Street investor as Nvidia did despite the high volatility of its stock. The added factor to benefit Nvidia is its position to cater to the processor demands of data centers, which are expanding at scale at this time, and Nvidia is the champion of the accelerator market.

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