Chip Stocks News: Why Are AMD, INTC, NVDA, MU, GFS Stocks Higher Today?
Great news from Nvidia (NASDAQ:NVDA) today has other chip stocks that are absolutely taking off. Since Advanced micro-systems (NASDAQ:AMD) for Intel (NASDAQ:INTC), Micron (NASDAQ:MU) and GlobalFoundries (NASDAQ:SFP), we are seeing big moves within semiconductor companies.
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Such a correlated movement suggests that sentiment is changing in this sector. Indeed, worries about valuations and other macro issues had led to a sell-off earlier this year. However, renewed interest in chipmakers is prompting investors to sharpen their pencils.
Today, the continued recovery of stock markets has greatly benefited these growth stocks. Let’s see where this rally came from and what news Nvidia shared.
Chip stocks soar on potential collab deals
Yesterday, we learned that Nvidia and Intel were exploring a chipmaking deal. In a call with reporters, Nvidia CEO Jensen Huang noted that the company was interested in the potential use of Intel’s foundries. Such a move would make strategic sense, as it would move at least some Nvidia production to the United States. Given the current geopolitical risk, these talks are perhaps less surprising than they would have been a few months ago.
Now, it should be noted that Intel’s foundries are still under construction in the US and Europe. As a result, any potential collaboration would likely take place years later. Additionally, Nvidia stipulated that for such a deal to work, Intel would have to achieve the same caliber of Taiwan semiconductor (NYSE:TSM). That’s a pretty high bar to reach.
That said, this potential collaboration is seen as positive for the industry. As investors look to this sector for growth, how these companies choose to position themselves matters. Right now, investors seem to like what they see coming from chipmakers.
As of the date of publication, Chris MacDonald had (neither directly nor indirectly) any position in the securities mentioned in this article. The opinions expressed in this article are those of the author, subject to InvestorPlace.com publishing guidelines.
