GFS - Nvidia leads chips higher as sector looks to end the week on solid ground

2023-06-30 11:52:16 ET

Semiconductor stocks were largely higher on Friday, spurred in part by an upgrade of Nvidia ( NASDAQ: NVDA ) on the company's artificial intelligence prowess.

Nvidia ( NVDA ) shares rose nearly 4% after Daiwa Capital upgraded the tech giant, citing recent checks into the company's strong position in artificial intelligence.

Analyst Louis Miscioscia raised his rating on Nvidia ( NVDA ) shares to outperform from neutral and boosted his per-share price target to $475 from $408, noting the company's dominance in AI and in particular, generative AI, will be difficult to match for competitors like AMD ( AMD ) and Intel ( INTC ) due to Nvidia's full-scale offerings.

"Many reports suggest AMD/Intel GPUs are pretty darn powerful, they are, but it is not just about silicon, it is about everything combined," Miscioscia wrote in the investor note.

AMD ( AMD ) shares rose more than 2.5% , while Intel ( INTC ) gained 1.1% .

Separately, Bank of America conducted a survey and found that optimism amongst investors is growing, as 59% of participants described their own portfolio as overweight semiconductors.

The firm added that long-only investors favor Nvidia ( NVDA ), Marvell Technology ( MRVL ), ASML ( NASDAQ: ASML ) and Micron Technology ( MU ), while hedge funds like Nvidia and AMD.

Taiwan Semiconductor ( NYSE: TSM ) shares rose around 0.4% even as the company confirmed it was the recipient of a data breach by a group linked to Russia.

The global foundry, which produces chips for a number of companies, said there had been a "cybersecurity incident" at one of its IT hardware suppliers, which resulted in the leak of "information pertinent to server initial setup and configuration."

GlobalFoundries ( GFS ), which competes with Taiwan Semiconductor ( TSM ), rose 2.5% in late morning trading.

Chip equipment makers were in the spotlight after the Netherlands announced on Friday a new rule to curb exports of certain advanced chipmaking equipment to China on the basis of national security.

The new rule will be effective on September 1. The Dutch government expects 24 permits to be applied for once and 20 permits on an annual basis.

Dutch-based ASML Holding ( ASML ) shares slipped 0.1% after the announcement, while U.S.-based semiconductor equipment companies, like KLA Corp. ( KLAC ) and Lam Research ( LRCX ), were up 0.5% and 1.5% , respectively. Applied Materials ( AMAT ) saw fractional losses.

Semiconductor stocks related to smartphones were also in positive territory on Friday after investment firm Citi said Apple ( AAPL ) is taking market share against Android.

Skyworks Solutions ( SWKS ) and Qorvo ( QRVO ) were up 0.4% and 0.2% , respectively.

Apple ( AAPL ) shares were up more than 1.5% as the company topped the $3T valuation mark.

Other semiconductor stocks were also in positive territory on Friday, including Qualcomm ( QCOM ), Broadcom ( AVGO ), Texas Instruments and Analog Devices ( ADI ).

More on Nvidia

• Nvidia's Valuation Is Stretched And Resembles The Tech Bubble Of Early 2000s
• Nvidia: A Reality Check, Sooner Or Later
• Is Nvidia In A Class Of Its Own? Cameron Fen With James Foord

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