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Shares of Dell Technologies hit a record high on Friday, driven by a rally in companies focused on generative artificial intelligence (AI) applications. This surge is buoyed by strong optimism surrounding the new technology.
Nvidia’s Influence on Market Sentiment:
On Wednesday, AI-heavyweight Nvidia posted strong quarterly results and forecast current-quarter revenue above Wall Street expectations.
This reinforced the belief that customer spending on generative AI will remain robust. The positive momentum extended to Dell, which has recently launched AI-oriented personal computers and more powerful servers in collaboration with Nvidia.
“This is an important and timely new opportunity for Dell,” said Bob O’Donnell of TECHnalysis Research.
Dell Stock Performance:
Dell shares rose 6% to $162.82 after paring some gains in the afternoon. They were on track to add $6.6 billion to their market value. The stock, which has more than doubled year to date, had ended in the green for the previous three sessions.
Broader Market Impact:
On Friday, shares of major chip firms saw increases, with Nvidia rising nearly 1% and Qualcomm gaining 4%. U.S.-listed shares of Arm Holdings were up 2.3%.
Shares of software companies C3.ai and Palantir Technologies also experienced gains, rising 0.6% and 1.6%, respectively.
“Chip companies are expected to benefit heavily from AI chip-related orders, primarily from Cloud providers, who have indicated a significant increase in their capital expenditure for 2024,” said Akshara Bassi, an analyst at Counterpoint Research.
