Nvidia (NVDA, Financials) briefly overtook Apple (AAPL, Financials) in market capitalization Tuesday, supported by geopolitical developments and strong momentum in AI infrastructure deals.
Nvidia’s gains follow the Trump administration’s reversal of the Biden-era AI diffusion rule, which would have restricted advanced chip exports. The U.S. Bureau of Industry and Security said the policy would have imposed burdensome rules and strained international relations. The White House also said Huawei’s Ascend AI chip purchases breach existing export controls.
Investor sentiment was further boosted by Nvidia’s new partnership with Saudi Arabia’s state-backed firm Humain to develop domestic AI infrastructure, dubbed sovereign AI. BofA Research analyst Vivek Arya projects sovereign AI could represent 10%15% of the global $450 billion to $500 billion AI infrastructure market, or more than $50 billion annually.
Bloomberg reported the Trump administration is exploring a deal allowing the United Arab Emirates to import 500,000 high-end chips per year through 2027. The Department of Commerce declined comment.
Chip sector momentum extended to peers: Advanced Micro Devices (AMD, Financials) jumped 6%, and Arm Holdings (ARM, Financials) advanced 4.2%.
This article first appeared on GuruFocus.
