Why Nvidia share price rallied 12% this week?

Chipmaker and leader in the artificial intelligence and gaming industry, Nvidia, has been on a major upcycle as its share price soared about 12% for the week ended May 19, 2023. The stock has jumped about 120% so far this year, to be the best performing stock in the Nasdaq 100. 

To put things into perspective, the Nasdaq 100 rose about 25% since January this year until May 18. Social media platform Meta Platforms, chipmaker AMD and online marketplace Mercado Libre were the top gainers this week after Nvidia. 

Nvidia share price: Historical Price Performance

Nvidia share price: What pushed share prices higher? 

Nvidia is among the leading chipmakers in the world, whose microchips are heavily utilized in artificial intelligence and in the gaming business. 

Offlate, there has been a sudden surge in demand for AI enabled products since chatbots like ChatGPT and Bard became more mainstream. Investors have warmed up the the possibility that AI driven companies and firms that enable AI services are set to perform better financially over the widespread adoption of AI. 

Furthermore, Nvidia also announced earlier this week the debut of its GeForce RTX 4060 family of graphics processing units which are AI enabled and can smoothly run the most advanced game graphics. 

Nvidia share price: How other chipmaker shares performed this week?

Nvidia share price: Analyst View

• Credit Suisse, increased the firm's price target to $350 from $300, while maintaining an outperform rating on the shares. The brokerage house noted that in light of the surge in interest for AI, cloud providers are scaling their AI and offerings for fear of missing out on “AIs iPhone moment”.
• pBroker Oppenheimer raised the share price on the stock to $350 from $300, while maintaining an outperform rating. The brokerage house also cited the fast growth opportunity in the AI space. 

This is not investment advice. Investments in the securities market are subject to market risk, read all the related documents carefully before investing. Past performance is not indicative of future returns.