Key facts
- Arm Holdings stock surged 14% pre-market on news of Nvidia's new AI chip for PCs.
- Nvidia CEO Jensen Huang stated the new chip will enable autonomous AI agents to run on PCs.
- Mizuho raised its price target for Arm to $425.
- Marvell Technology shares surged over 25% after Nvidia CEO Jensen Huang predicted a $1 trillion valuation.
- Nvidia invested $2 billion in Marvell to integrate custom AI chips.
- Marvell forecasts its custom chips business revenue to surpass $10 billion by fiscal 2029.
- HPE shares surged 19% following strong earnings and an AI-fueled sales outlook.
- HPE stock increased by 31% in a separate report.
- The iShares Expanded Tech-Software Sector ETF has surged 42% from its April low.
- Software stocks have gained approximately 40% from their April lows.
- Palantir is leading software stocks with an 8-year high in EPS revisions.
- Microsoft shares broke above their 200-day moving average.
Technology stocks have experienced a broad rally, largely fueled by optimism surrounding artificial intelligence and strong corporate performance. Arm Holdings saw its shares jump 14% pre-market after Nvidia unveiled its RTX Spark PC superchip, which incorporates Arm-based CPU technology through MediaTek. Nvidia CEO Jensen Huang stated this chip will enable autonomous AI agents to run directly on personal computers. Mizuho responded by raising its price target for Arm to $425. Separately, Arm CEO Rene Haas expressed confidence in achieving a $15 billion chip sales target ahead of schedule, citing AI infrastructure spending. Mizuho further raised its price target to $500, pointing to potential AI ASIC launches and AGI CPU expansion. However, Arm insiders sold $25.6 million in stock prior to this rally, missing out on the subsequent price increase.
Marvell Technology shares surged over 25% following endorsements from Nvidia CEO Jensen Huang, who called the chipmaker the 'next trillion-dollar company' and predicted it could reach a $1 trillion valuation due to its critical role in AI infrastructure. Huang and Marvell CEO Matt Murphy spoke at Computex in Taipei. Nvidia has previously invested $2 billion in Marvell to integrate custom AI chips with its networking gear and processors. Marvell forecasts its custom chips business revenue to surpass $10 billion by fiscal 2029. Marvell's market capitalization now positions it as the largest company eligible for S&P 500 inclusion.
Hewlett Packard Enterprise (HPE) shares also experienced a significant surge, jumping 19% to their best-ever trading day. This rise followed strong earnings and an AI-fueled sales outlook that exceeded estimates. CEO Antonio Neri highlighted HPE's unique market position in AI and discussed growing demand and pricing. In a separate report, HPE stock increased by 31%, though the specific catalyst was not detailed, and some analyses question if the stock is now overvalued.
The broader software sector has rebounded strongly from a significant selloff. The iShares Expanded Tech-Software Sector ETF has surged 42% from its April low, with investors betting that AI will significantly boost the sector. Nvidia's CEO indicated that AI agents will drive increased software demand. Software stocks, in general, have gained approximately 40% from their April lows. Palantir is leading software stocks with an 8-year high in EPS revisions, signaling strong positive analyst sentiment. Microsoft shares have broken above their 200-day moving average, suggesting a potential comeback for software stocks as they overcome AI-related jitters. Oracle's stock is also rallying ahead of its earnings report, recognized as a new leader in AI infrastructure. Wedbush has raised its price target for cybersecurity firm Palo Alto Networks.
Other notable stock movements include Broadcom, where options activity suggests traders are positioning for a potential breakout above $500 post-earnings. IBM initiated coverage with an Overweight rating and a $350 price target from Barclays, contributing to an 11-12% premarket surge, driven by its strong software business. In India, Anshul Saigal suggests current market valuations present a buying opportunity with a 3-5 year horizon, citing strong long-term growth prospects in AI data centers and other sectors. TMHC and NVDA were also highlighted as top stock movers on a recent Monday.