Why Is NVDA Stock Rising In Premarket?

Nvidia CEO Jensen Huang indicated that AI-linked stocks were at a discount, presenting a buying opportunity.

• Huang is currently on a visit to South Korea.
• Nvidia and SK Hynix announced a new partnership for components for Nvidia’s Vera Rubin accelerators.
• Micron shares rose 4%, while Intel and Advanced Micro Devices stocks gained 0.5% and 2%, respectively.

Nvidia shares rose 1.5% in the early premarket session on Monday, amid gains in the broader semiconductor space after Nvidia CEO Jensen Huang called a global tech stocks selloff that began last week a buying opportunity, saying the buildout of artificial intelligence has just begun.

Huang, responding to reporters during a trip to Seoul, said the industry was still in the early stages of constructing infrastructure that will serve as the foundation of an AI-fueled future, according to a Bloomberg report.

“We’re at the beginning of it, and whatever happened to the stock market, you should be very happy because now you can buy at a discount,” Huang said. “Everybody should be very excited,” he said.

South Korea’s benchmark KOSPI Index slid on Monday as investors pared exposure to AI-linked stocks that have been a key driver of the global equity rally. The retreat followed a sharp selloff in U.S. technology shares on Friday amid renewed concerns that interest rates could remain higher for longer.

On Monday, Micron shares rose 4%, while Intel and Advanced Micro Devices stocks gained 0.5% and 2%, respectively. They all had dropped sharply last Friday. 

Nvidia-SK Hynix Partnership

Earlier in the day, Nvidia announced a major partnership with South Korea’s SK Hynix for its next-generation Vera Rubin system.

As part of the deal, SK Hynix will supply memory chips and components for Nvidia’s Vera Rubins, which will begin shipping to customers in the third quarter. The Korean chipmaker said it would enter new AI fields via the partnership, such as personal AI and physical ​AI, and that the deal would help maintain a stable supply of ​memory chips despite the advanced memory semiconductors' long development cycles.

Last week, Huang confirmed for the first time the Nvidia had cleared Samsung, SK Hynix and Micron Technology to supply that memory and other components for Nvidia’s Vera Rubins.

Retail View On NVDA

Still, the mood remained sombre for Nvidia. The stock has significantly underperformed rivals such as Intel and AMD this year, despite reporting remarkable financial performance in the last quarter.

On Stocktwits, retail sentiment for NVDA shifted to ‘neutral’’ from ‘bullish’ the previous day, amid ‘low’ message volume, although many traders cheered the SK Hynix deal and expected NVDA to gain strongly.

Nvidia stock is up 14.7% year to date, compared to the nearly 80% gains in the iShares Semiconductor ETF (SOXX).

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