When Oracle (ORCL) posted strong quarterly results, it lifted artificial intelligence technology suppliers. Oracle shares added 14.3% last week. The week before, Broadcom (AVGO) fell to around $135 after it reported results.
Last week, it gained 22.4% to complete a W-shaped rebound. This formation began after the August 5, 2024 sell-off.
Nvidia (NVDA) set off the weekly rally last week. CEO Jensen Huang said that accelerated computing is a $1 trillion revenue opportunity. Huang said, “That’s going to happen no matter what.” Generative AI is the next phase after AI.
The CEO believes that gen AI is not just a tool. It is a skill that created a new industry.
On September 11, 2024, OpenAI held talks to raise around $6.5 billion in funds. That would value OpenAI at around $150 billion. This is a $70 billion valuation increase from nine months ago. Microsoft (MSFT), which holds a large stake in the firm, is involved in the discussions. Apple (AAPL) and Nvidia are also participating.
Among the Magnificent 7, MSFT stock has strong upside potential from AI. The stock gained 7.19% last week, breaking above its resistance at the 50-day simple moving average.
Watch for clients to validate the returns from Gen AI. They will rent AI servers first to build their model. When the AI development pays off, they will continue to invest in AI solutions.
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