Sharp gains were clocked in major US technology stocks on Wednesday, which soared up to 9% after President Donald Trump Declared a two-week ceasefire in Iran.
The rally was driven by reduced risks of attacks on US data centres and GCC compute hubs located in the gulf and middle east region.
Shares of Intel Corp. rose as much as nearly 9% to $57.38, while Meta Platforms Inc. rose 5% in early trade to $602.80, Microsoft Corp. also rose 2% to trade at $379.55. Besides these, all of the magnificent seven traded in the green over 2% higher.
Google parent Alphabet Inc. had surged 4.05% higher to $317.57, while aI-linked bellwether chipmaker Nvidia rose over 3% after the market opened to trade at $183.75. The stocks later pared gains but remained in the green territory.
As of 11 a.m., EST, Intel's stock pared gains to trade 6.5% higher at $56.34, Alphabet traded 3.7% higher at $316.91, Meta Platforms was up 3.3% at $593.97, and Nvidia traded 1.77% higher at $181.25, and Microsoft traded 1.6% higher at $378.44.
ALSO READ: Wall Street Rockets On Iran Truce; S&P, Nasdaq Jump Over 2.5%, Dow Up Nearly 1,400 Points
Big Tech companies including Microsoft, Google, Amazon, and others are investing billions of dollars to transform the Gulf Cooperation Council (GCC) region— primarily the UAE and Saudi Arabia— into a global AI compute hub.
The Gulf region is viewed as a strategic location to build data center infrastructure on account of its abundant energy, local government support, and sovereign wealth.
America's tech titans aim to build a third global compute node alongside the United States and China. However, ecalations in the middle east conflict had putting the future of these hubs in jeopardy.
Data centers were targeted as part of Iran's wave of retaliatory attacks on AWS facilities in the UAE and Bahrain in the month of March. This caused outages in banking, payments, enterprise and consumer services.
From AWS To Google Cloud: Key Investments Made By Big Tech Companies In The Middle East
- Microsoft, OpenAI, NVIDIA, Cisco, and SoftBank collaborated with Abu Dhabi Abu Dhabi's G42 to develop a 5-gigawatt (GW) "Stargate" AI campus. This is slated to be the largest AI campus outside the US.
- Microsoft has also committed $15.2 billion to the UAE between 2023 and 2029 to expand AI and cloud data centers.
- Saudi Arabia has invested $10 billion in a global AI hub by Google Cloud and the Public Investment Fund (PIF).
- Amazon Web Services (AWS) has committed over $5.3 billion to build a new data center region in Saudi Arabia.
- DataVolt has inked $5 billion agreement to build a 1.5-gigawatt net-zero AI factory in Saudi Arabia's NEOM.
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