Chips stocks such as Sandisk, SK Hynix, Intel, Micron, AMD rebounded during the pre market session on Tuesday, September 29 after leading Wall Street's rout in the previous trading session.
The rally in these stocks was led by Micron, surging 1.57% to $1,070.5, followed by Sk Hynix shares, rising 1.43% to $184.52. Sandisk was up 1.2% to $1,733.36, AMD jumped 0.8% to $613.25, Nvidia climbed 0.69% to $230.4, while Intel shares traded 0.23% higher at $116.3.
The latest surge comes amid renewed optimism among investors in the semiconductor and artificial intelligence space as Advanced Micro Devices (AMD) announced to acquire World Labs for $8.2 billion, an artificial intelligence startup founded by AI pioneer Fei-Fei Li. The all-stock transaction is likely to close by the end of the year, subject to regulatory approvals, according to a statement issued by the companies on Monday. AMD, a major competitor to Nvidia for AI chips business, is developing a team of leading researchers and their models, along with insights into how the artificial intelligence segment is evolving. This is expected to help the company plan its future hardware releases, according to reports.
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Meanwhile, Nvidia's board of directors authorised an additional $150 billion for its share repurchase program, increasing the chip giant's total remaining buyback capacity to $235 billion. The development indicates the largest single share repurchase authorisation increase in corporate history. The company plans to execute the rest of $235 billion repurchase program through fiscal year 2028. Founder and CEO Jensen Huang highlighted that rising free cash flow provides Nvidia the balance-sheet strength to aggressively reinvest in frontier technologies while giving signifcant capital to equity holders, describing the broader transition toward accelerated computing as a once-in-a-generation platform shift.
The renewed optimism in the sector comes a day after major semiconductor stocks came under selling pressure, with major chipmakers and data-storage companies falling as investors pared exposure to the sector after a strong run last week.
Intel shares dropped 5.45% to $116.30, down $6.70 from the previous close. SanDisk declined 3.63% to $1,713.32, losing $64.48, while Advanced Micro Devices (AMD) fell 3.74% to $606.82, down $23.60. SK Hynix's US-listed ADRs were also under pressure, falling 4.16% to $183.60, or $7.96 lower.
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