The Stock of NVIDIA Rally on a Positive Day for the Chip Industry, Ahead of a Large Test

Nvidia Corp. shares saw a notable rebound on Monday, aligning with a strong performance in the semiconductor sector and ahead of several key earnings reports that could reveal trends in spending on artificial-intelligence (AI) hardware.

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On Monday morning, Nvidia's shares rose by 2.3%, building on a 0.7% gain from Friday. This uptick followed a three-session decline that had pulled the stock down by about 9%.

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Nvidia’s stock performance is part of a broader rally in the chip sector on Monday, led by On Semiconductor Corp., an automotive-chip company. On Semiconductor shares jumped 12.68% after the company reported strong profit figures early Monday, marking the start of a busy earnings week for the semiconductor industry.

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This week, several significant reports are expected, including those from Advanced Micro Devices Inc. (AMD), Western Digital Corp. (WDC), and Intel Corp. (INTC). Notably, Intel shares were the only ones declining in the PHLX Semiconductor Index (SOX) early on Monday, with the index itself up 1.9%.

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AMD’s earnings report is particularly anticipated as it will shed light on the company’s progress in becoming an alternative supplier of AI graphics processing units (GPUs) to Nvidia. Investors have been concerned about potential order cuts for AMD following Nvidia’s GTC event earlier this year.

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Wall Street is also closely watching reports from companies outside the semiconductor sector to better understand Nvidia’s future prospects. Comments from Microsoft Corp. (MSFT), Amazon.com Inc. (AMZN), and Meta Platforms Inc. (META) — all expected to report this week — will be crucial in assessing how these tech giants plan their capital spending on AI hardware in the near future.

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An important factor for investors is whether these companies are seeing returns on their AI investments. This is significant for those anticipating that large-scale cloud providers will continue to invest heavily in AI technology.

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In addition, Nvidia CEO Jensen Huang is set to participate in a fireside chat with Meta CEO Mark Zuckerberg at 6 p.m. Eastern time on Monday. This event could provide further insights into Nvidia’s strategic direction and collaborations in the AI space.

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