Despite U.S. President Donald Trump’s threat to impose an additional 50% tariff on Chinese goods, the U.S. stock market showed resilience. The Nasdaq rose by 0.10%, leading to a rally in most semiconductor stocks and pushing the semiconductor index up by nearly 3%.
On Tuesday, the semiconductor index surged 2.70% to close at 3,694.95 points.
Market analysts attribute this sharp rise to significant bargain hunting, as investors capitalized on undervalued stocks following recent declines. The semiconductor sector had been plummeting in recent days due to escalating U.S. and China trade tensions.
Nvidia was a standout performer, surging 3.53% to close at $97.64.
Brad Gerstner, a well-known Wall Street investor, revealed in a CNBC interview that he had purchased Nvidia shares that day.
Gerstner cited robust demand for graphics processing units (GPUs) and the likelihood that Trump would exempt semiconductors from tariffs as key reasons for his investment decision.
While Trump has imposed a 25% tariff on automobiles, he has yet to apply similar measures to semiconductors.
As a result of NVIDIA’s surge, this sparked a broader rally across the semiconductor sector. Although Intel Corporation dipped 1.41%, Micron Technology jumped 5.64%, and Broadcom Inc. soared 5.37%. This positive momentum drove the semiconductor index to close nearly 3% higher.