Why Nvidia, AMD, and Other Semiconductor Stocks Are Surging This Thursday
Semiconductor stocks including Nvidia and AMD bounced back strongly on Thursday after earlier declines, driven by renewed investor confidence amid easing economic concerns and promising AI demand forecasts.
Highlights
- Chip stocks surged on Thursday, recovering from earlier weekly losses triggered by economic uncertainties and rumors about delays in Nvidia’s upcoming Blackwell chip launch.
- The rally followed encouraging economic data, particularly a better-than-expected weekly jobless claims report, alleviating some market fears.
- Analysts view the recent volatility as a buying opportunity, anticipating sustained growth fueled by increasing demand for artificial intelligence technologies.
Shares of Nvidia (NVDA), Advanced Micro Devices (AMD), Broadcom (AVGO), and other key semiconductor companies experienced a robust rebound on Thursday after earlier setbacks caused by concerns over the U.S. economy and reports of potential delays in Nvidia’s Blackwell chip rollout.
The iShares Semiconductor ETF (SOXX) climbed more than 6% during Thursday afternoon trading, reversing nearly a 3% drop from Wednesday. The semiconductor sector has seen significant volatility recently, especially following a disappointing July jobs report that rattled markets last Friday.
This surge in chip stocks contributed to solid gains across major indices, with the technology sector leading the S&P 500 to a 2.3% increase. The tech-heavy Nasdaq index jumped 2.9%.
Economic Concerns May Have Been Overestimated
The Thursday rally coincided with evidence suggesting that earlier market fears driving the global sell-off might have been exaggerated. The latest jobless claims data revealed fewer unemployment applications than anticipated by economists.
Market expectations for Federal Reserve rate cuts have moderated, with the CME Group’s FedWatch tool indicating a 55% probability of a 50-basis-point cut in September, down from 99% earlier in the week when emergency rate cut speculation was high.
Volatility Presents a Strategic Buying Opportunity, Experts Say
Given the long-term growth potential tied to artificial intelligence demand, analysts recommend considering recent price dips in Nvidia and other semiconductor stocks as attractive entry points.
Despite reports of possible delays in Nvidia’s Blackwell AI chip launch, analysts from Piper Sandler, Oppenheimer, Bank of America, and Goldman Sachs remain confident in Nvidia’s enduring market strength and AI leadership.
Nvidia confirmed to Investopedia on Tuesday that Blackwell production remains "on track" to scale up in the latter half of the year.
Shares of Nvidia, Broadcom, and AMD each rose by more than 5% during recent trading sessions.
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