What Happened?
A number of stocks jumped in the afternoon session after renewed confidence in the artificial intelligence sector fueled a market rally as Nvidia's CEO confirmed that computing demand has "gone up substantially."
These comments helped reassure the market that the AI boom is supported by genuine demand, calming fears that were sparked a day earlier by a report questioning the profitability of Oracle's cloud business. The rally was strong enough to put the information technology sector on pace for a fresh closing high. This upward momentum occurred despite potential headwinds from an ongoing U.S. government shutdown, which entered its second week.
The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks.
Among others, the following stocks were impacted:
- Analog Semiconductors company Vishay Intertechnology (NYSE: VSH) jumped 3.1%. Is now the time to buy Vishay Intertechnology? Access our full analysis report here, it’s free for active Edge members.
- Semiconductor Manufacturing company Marvell Technology (NASDAQ: MRVL) jumped 5.1%. Is now the time to buy Marvell Technology? Access our full analysis report here, it’s free for active Edge members.
- Analog Semiconductors company MACOM (NASDAQ: MTSI) jumped 3.9%. Is now the time to buy MACOM? Access our full analysis report here, it’s free for active Edge members.
- Analog Semiconductors company onsemi (NASDAQ: ON) jumped 4.7%. Is now the time to buy onsemi? Access our full analysis report here, it’s free for active Edge members.
- Analog Semiconductors company Microchip Technology (NASDAQ: MCHP) jumped 2.8%. Is now the time to buy Microchip Technology? Access our full analysis report here, it’s free for active Edge members.
Zooming In On Marvell Technology (MRVL)
Marvell Technology’s shares are extremely volatile and have had 36 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 2 days ago when the stock gained 3.2% as AMD's deal with OpenAI intensified the ongoing AI frenzy that has powered the market. The positive momentum was linked to an announcement that AMD and OpenAI entered into an agreement to power OpenAI's AI infrastructure with AMD's Instinct GPUs. This significant deal underscored the massive demand for advanced chips needed for artificial intelligence applications. The development occurred as the U.S. semiconductor manufacturing industry was already experiencing rapid growth, fueled by AI-driven demand and government support from initiatives like the CHIPS and Science Act.
Marvell Technology is down 18.5% since the beginning of the year, and at $92.60 per share, it is trading 26.5% below its 52-week high of $126.06 from January 2025. Investors who bought $1,000 worth of Marvell Technology’s shares 5 years ago would now be looking at an investment worth $2,166.
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