The chip sector outperformed the broader market on Thursday, with shares in Nvidia Corp, Advanced Micro Devices (AMD) and Micron Technology (MU) providing the biggest boosts. The sector was buoyed by investor interest in artificial intelligence (AI) and news from Japan that Micron would invest up to 500 billion yen ($3.70 billion) in extreme ultraviolet (EUV) technology in the country.
Synopsys (SNPS) shares also rose 8.7% after it forecast better-than-expected third-quarter profit estimates, citing increased use of AI and automation. Nvidia (NVDA) shares were up 5.0%, while AMD and Intel (INTC) shares rose 4.0% and 2.8%, respectively.
Kim Forrest, chief investment officer at Bokeh Capital Partners in Pittsburgh, attributed the rally to investor interest in AI, noting that chips are the part of the AI story investors can buy into today. Nvidia shares hit their highest level since December 2021, while Micron shares touched their highest point since June 2022.
The S&P 500 technology index was up 2.1%, and the S&P 500 growth index rose at a slower 1.0% pace. Nvidia is due to report quarterly results on May 24.