Nvidia closes with $2 trillion valuation as Dell stokes AI rally

© Reuters. FILE PHOTO: A NVIDIA logo is shown at SIGGRAPH 2017 in Los Angeles, California, U.S. July 31, 2017. REUTERS/Mike Blake/File Photo

By Noel Randewich

(Reuters) -Nvidia's stock market value closed above $2 trillion for the first time on Friday after an upbeat report from Dell Technologies reignited Wall Street's AI-fueled rally.

Nvidia's stock added 4% after Dell, which sells high-end servers made with Nvidia's processors, gave an upbeat forecast late on Thursday, pointing to a surge in orders for its AI-optimized servers.

Dell's shares soared as much as 38% to a record high before ending the session with a 32% gain.

Friday's rally put Nvidia's market capitalization at $2.06 trillion, making it Wall Street's third most valuable company behind Microsoft (NASDAQ:MSFT) and Apple (NASDAQ:AAPL), at $3.09 trillion and $2.77 trillion, respectively.

Super Micro Computer, another company that sells servers made with Nvidia's chips, jumped 4.5%.

Other chipmakers exposed to AI rallied to record highs, with Broadcom (NASDAQ:AVGO) and Marvell Technology (NASDAQ:MRVL) each up about 8%, while Advanced Micro Devices (NASDAQ:AMD) climbed over 5%.

The PHLX chip index rallied 4.3% to its own record high, lifting its 2024 gain to 18%.

Nvidia controls about 80% of the high-end AI chip market, with customers including ChatGPT creator OpenAI, Microsoft, Alphabet (NASDAQ:GOOGL) and Meta (NASDAQ:META) Platforms snapping up tight supplies of its components to compete in the fast-emerging generative AI sector.

The company has recently become Wall Street's most traded stock by value, day to day, replacing Tesla (NASDAQ:TSLA). Investors exchanged $36 billion worth of Nvidia's stock on average over the past 30 sessions, compared to $21 billion a day for Tesla.

Trading in Nvidia on Friday reached $38 billion worth of shares.

On Feb. 23, the Santa Clara, California-based company added $277 billion in stock market value in just one session, a Wall Street record, after it forecast a roughly threefold surge in quarterly revenue.

Nvidia's stock has now risen 66% in 2024 after more than tripling last year. Last month, its stock market value overtook Amazon (NASDAQ:AMZN) and Alphabet.

A week ago, Nvidia's stock market value edged above $2 trillion for the first time before receding by the end of the session.

Saudi Aramco (TADAWUL:2222) has a $2.045 trillion market capitalization, although over 90% of it is closely held by the government of Saudi Arabia and less than 2% of its shares are available for trading by investors, according to LSEG data.