Nvidia rally overnight lifts chip-related stocks in Asia on AI optimism

Asia’s semiconductor and associated stocks rose on Wednesday after chipmaker Nvidia became the world’s most valuable company, riding the AI boom.

Nvidia climbed 3.6% on Tuesday, lifting the company’s market cap to $3.34 trillion, surpassing Microsoft, which is now valued at $3.32 trillion.

Earlier this month, Nvidia hit $3 trillion for the first time, soaring past Apple. Nvidia shares are up nearly 174% so far this year.

Contract chip manufacturer Taiwan Semiconductor Manufacturing Corp gained as much as 4.34% as the upbeat investor sentiment over Nvidia spilled over to tech stocks in Asia.

TSMC manufactures Nvidia’s high-performance graphics processing units that help power large language models — machine learning programs that can recognize and generate texts.

Taiwan’s Hon Hai Precision Industry — known internationally as Foxconn — gained as much as 4.78%. It has a strategic partnership with Nvidia to build “AI factories,” which will use Nvidia’s chips in a whole range of applications, including electric vehicles and LLMs.

SK Hynix provides high bandwidth memory (HBM) chips to Nvidia, which are used in AI chipsets. Until March, the company was the sole known supplier of HBM chips to Nvidia, Reuters reported.

In June, Nvidia CEO Jensen Huang reportedly told journalists that the company was studying HBM chips made by Samsung and U.S. firm Micron Electronics.

Samsung had earlier refuted an exclusive Reuters report that that its chips were failing Nvidia’s tests due to heat and power consumption issues, with Huang also quoted as saying “there is no story there,” when asked about the report.