Shares of NVIDIA (NVDA) surged on Monday as reports indicated that the chip giant is gearing up for the mass production of its new AI chip designed specifically for China in 2024. The move is expected to have significant implications for NVIDIA’s market cap and today’s trading activities.
According to Reuters, NVIDIA is set to commence production of the new AI chip in the second quarter of 2024. This development follows the company’s previous efforts to create two chips that would comply with US regulatory measures, enabling them to sell in the Chinese market.
The latest chip, slated for delivery in Q2 of 2024, stands out for its increased power compared to its predecessors. This news is particularly exciting for consumers in China, as it addresses concerns expressed by major tech players like Alibaba and Huawei, who were less enthusiastic about less powerful NVIDIA chips.
Madison Mills of Yahoo Finance emphasized that this move by NVIDIA has the potential to impact today’s trade more significantly than other market factors. Traders are keenly observing reactions from Alibaba and Huawei regarding their sentiments on the more potent AI chip slated for release in 2024.
NVIDIA has positioned itself as the top performer in the Magnificent Seven in today’s market action. This development raises the question of whether NVIDIA’s performance could contribute to a positive shift in the Mag Seven, especially after last week’s lackluster performance driven by Apple downgrades.
As the market watches NVIDIA’s trajectory, the broader question of continued momentum in the Mag Seven trade looms large as we enter 2024. Analysts anticipate that the performance of NVIDIA, especially with the launch of its powerful AI chip, could play a pivotal role in shaping the market’s direction.
With the anticipation of Federal Reserve communication later in the afternoon, there is speculation about the potential impact on market dynamics. As 2024 unfolds, all eyes remain on NVIDIA and its strategic moves in the AI chip space.
