Tag Archives: NVDA

AI Arms Race Sparks Semiconductor Surge, NVIDIA Rises Nearly 8%, Achieving the Strongest Rally in 10 Months

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The AI “arms race” has triggered a semiconductor frenzy, with NVIDIA (NASDAQ:NVDA) stock surging nearly 8%, marking its strongest rise in nearly 10 months. Earlier, six of the seven tech giants had already reported their earnings, with the most noteworthy being that Google (NASDAQ:GOOGL), Microsoft (NASDAQ:MSFT), Amazon (NASDAQ:AMZN), and Meta Platforms (NASDAQ:META) will collectively spend approximately $650 billion on capital expenditures in 2026.

Last week, Meta announced its capital expenditures would rise to as much as $135 billion for the year, representing an 87% increase. Meanwhile, Microsoft reported a 66% year-on-year growth in its capital expenditures for Q2, and analysts predict its fiscal year capital spending through June will approach $105 billion.

Jensen Huang, CEO of NVIDIA, specifically praised OpenAI and Anthropic, two leading AI labs, stating that both are “making a lot of money.” NVIDIA invested $10 billion in Anthropic last year, and Huang earlier this week indicated plans to significantly invest in OpenAI’s next funding round. He mentioned, “If they can have twice the computing power, their revenue will increase fourfold.”

Earlier, Taiwan Semiconductor Manufacturing Company (NYSE:TSM), the world’s leading semiconductor foundry, set new performance records and announced plans to significantly increase its capital expenditures to $52-56 billion in 2026, far exceeding market expectations. This is aimed at accelerating the expansion of advanced manufacturing capacity to address the ongoing global shortage of AI chips.

CPO Industry Accelerates, Lumentum Surges Over 9%

NVIDIA, in a recent webinar, announced that three partners—CoreWeave (NYSE:CRWV), Lambda, and TACC—will deploy the IB CPO system in the first half of 2026, and Ethernet CPO products are expected to start shipping in the second half of 2026. The company believes that the CPO industry is advancing more quickly than expected, with the technology first landing in scale-out scenarios and expanding into larger market spaces. As a next-generation optical interconnect solution, the commercial value of CPO continues to become clearer, and its market potential is expanding.

Lumentum (NASDAQ:LITE) CEO Michael Hurlston stated in a recent earnings call that the company’s ongoing growth is primarily driven by cloud optical modules, OCS, and CPO. The development of the OCS business has exceeded expectations, with the first $10 million quarterly revenue target, initially set for Q3, being reached ahead of schedule. Demand for OCS from three core customers has surged, and Hurlston revealed that there is a backlog of over $400 million in OCS orders, most of which are planned to be delivered in the second half of 2026. Orders and revenue are expected to continue growing as they enter 2027.

Roivant Sciences Surges Over 22% After Promising Skin Disease Results

Roivant Sciences (NASDAQ:ROIV) saw its stock rise more than 22% after its subsidiary Priovant Therapeutics reported positive results from the phase 2 trial of its experimental drug brepocitinib. The drug showed improvements in the activity of skin nodular disease at higher doses. Another subsidiary, Pulmovant, also announced the completion of phase 2 trial enrollment involving around 120 patients for its experimental drug mosliciguat, aimed at treating pulmonary arterial hypertension associated with lung disease.

Priovant reported that patients taking a 45 mg dose showed a 22.3-point improvement on a key skin scoring system at week 16, while the placebo group showed only a 0.7-point improvement. The company noted that all patients in the 45 mg group showed significant improvement, with 62% achieving near-complete skin clearance, and 69% achieving complete or nearly complete clearance, while none of the placebo group patients achieved similar results.

Priovant plans to launch phase 3 trials in 2026, following consultations with the U.S. Food and Drug Administration (FDA).

The “Magnificent Seven” Once Drove the Market; Now, They Are Diverging

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The “Magnificent Seven” tech stocks, which once propelled the U.S. stock market to consecutive record highs, are increasingly moving in different directions. As investors grow more cautious regarding the Artificial Intelligence spending boom, the performance of this mega-cap portfolio has shown significant disparity over the past year.

Data from The Wall Street Journal reveals that in 2025, only Alphabet (GOOG) and Nvidia (NVDA) outperformed the S&P 500. The remaining five giants—Microsoft (MSFT), Meta Platforms (META), Apple (AAPL), Amazon (AMZN), and Tesla (TSLA)—all lagged behind the broader market. Fund managers note that this group is no longer synonymous with market leadership. David Bahnsen, Chief Investment Officer at The Bahnsen Group, stated:

“The correlation between them has collapsed. Today, the only thing they have in common is the trillion-dollar market cap label.”

This shift marks a new phase in the AI trade logic since the start of this bull market, as investors become more selective. Some capital is rotating toward sectors like healthcare, expecting AI dividends to spread, while others are focusing on chipmakers or energy companies. This reflects a market transition from general AI themes toward specific sub-sectors and tangible profitability.

The AI Arms Race Intensifies Internal Divergence

The AI spending frenzy is creating a structural divide within the “Magnificent Seven.” Amazon, Alphabet, Microsoft, and Meta have explicitly pivoted to become “Hyperscalers,” investing hundreds of billions of dollars to train new AI models, build data centers, and expand cloud computing infrastructure. Meanwhile, Nvidia continues to dominate the high-end AI chip market, providing the core computational power for the most advanced AI models.

In contrast, other members are falling behind. Apple’s stock underperformed the S&P 500 last year, as the iPhone maker faced market criticism for its cautious AI investment and slower progress relative to competitors. Tesla, once the market’s primary focus, has seen its stock performance significantly trail most of its peers as growth in electric vehicle sales slows down.

Michael Arone, Chief Investment Strategist at State Street Global Advisors, pointed out:

“They are at different stages of development. Previously, the rising tide lifted all boats; now, we are going to see clear winners and losers.”

Individual Investors Shift Their Focus

Individual investors, who were long-time stalwarts of the “Magnificent Seven,” are gradually turning their attention to other market segments. According to data from Vanda Research, the proportion of retail trading in these seven stocks last year was significantly lower than the levels seen in 2023 and 2024.

Taking Tesla as an example—a long-time favorite among retail traders—the decline in trading activity is particularly stark. In 2025, the average daily retail trading volume for the stock dropped by approximately 43% compared to its peak two years prior. Despite this divergence, these seven companies still wield massive influence over the market. According to Dow Jones Market Data, they collectively account for about 36% of the S&P 500’s total market capitalization, meaning their movements will continue to dictate the performance of the broader market.

Best Stocks To Buy Today: ASTS, MU,ASML

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As a new week begins, we are closely tracking market trends to provide multi-dimensional investment opportunities by identifying hot stock movements and top performers. Below is our selection for the Best Stocks To Buy Today.

Space Investment Fever Continues: AST SpaceMobile (ASTS) Surges Over 14% After Securing Prime Contractor Status for MDA’s “SHIELD” Project.

On the news front, U.S. satellite communications company AST SpaceMobile (ASTS) jumped over 14% last Friday. This followed confirmation that the company has been awarded prime contractor status for the U.S. Missile Defense Agency’s (MDA) “SHIELD” project. Formally known as the “Scalable Homeland Innovative Enterprise Layered Defense,” this project is part of the broader “Golden Dome” strategy, designed to build a resilient, layered defense system across air, missile, space, cyber, and hybrid warfare domains.

The award stems from the U.S. government’s public release of qualified bidders for the project on January 15, 2026. Chris Ivory, Chief Commercial Officer and Head of Government Business at AST SpaceMobile, stated: “Being selected as a prime contractor for the MDA SHIELD project is a significant validation of our unique, on-orbit dual-use technology and our growing capabilities in the defense sector.”

Micron Technology (MU) Gains 7.76% as It Warns Chip Shortage Will Extend into 2027.

Micron Technology (MU), a key supplier to Nvidia (NVDA), stated that the ongoing memory chip shortage has intensified over the past quarter. The company reiterated that due to the surge in demand for high-end semiconductors required for AI infrastructure, supply constraints will persist well beyond this year.

“The shortage we are currently seeing is truly unprecedented,” said Manish Bhatia, Executive Vice President of Global Operations at Micron, during an interview. This statement followed the groundbreaking ceremony for the company’s $100 billion manufacturing site on the outskirts of Syracuse, New York. This outlook reinforces similar forecasts provided by the company in December.

Bhatia pointed out that High Bandwidth Memory (HBM), essential for manufacturing AI accelerators, is “consuming a massive amount of available industry capacity, leading to significant supply shortages for traditional sectors like mobile phones and PCs.” He added that PC and smartphone manufacturers have already begun queuing up to lock in memory chip supplies for 2026 and beyond, while autonomous vehicles and humanoid robots are expected to drive demand for these components even higher.

ASML Holding (ASML) Rises Over 2% as Semiconductor Capital Cycle Re-accelerates

On Thursday, TSMC (TSM) released financial results showing a 35% year-on-year increase in net profit for the fourth quarter of 2025, beating expectations. The company also forecasted a Q1 operating margin of 54% to 56% (market estimate: 49.7%) and a gross margin of 63% to 65% (market estimate: 59.6%). These figures demonstrate that the chipmaker is benefiting significantly from the AI boom.

This signal was interpreted by the market as a vote of confidence in the sustained expansion of the AI industry. This directly ignited the stock prices of equipment giants like ASML and Applied Materials. Dutch photolithography leader ASML (ASML) hit a historic high, with its market capitalization surpassing the $500 billion milestone—becoming only the third European company to reach this valuation.

TSMC is one of ASML’s largest individual customers, and ASML’s lithography equipment is an “absolute necessity” for TSMC’s expansion and mass production of advanced process chips. Currently the highest-valued company in Europe, ASML’s core competitiveness lies in being the world’s only manufacturer capable of producing cutting-edge EUV lithography machines. TSMC requires this equipment to manufacture chips for everything from Apple (AAPL) smartphones to Nvidia (NVDA) AI accelerators.