By Brian Swint and Adam Clark
Nvidia, the world's largest semiconductor maker by market value, could officially overtake Apple for the No. 2 spot again.
Nvidia's market capitalization climbed above $3 trillion on Tuesday, briefly topping the iPhone maker in intraday trading. At the close, Nvidia was worth $3.17 trillion compared with Apple's $3.18 trillion.
Nvidia extended those gains in Wednesday trading, with shares up 2.9% to $133.87. Apple stock was up 0.2%.
The biggest news affecting shares today may be President Donald Trump's decision to rescind the planned AI diffusion rule, drawn up by the Biden administration to restrict exports of advanced chips.
"These new requirements would have stifled American innovation and saddled companies with burdensome new regulatory requirements. The AI Diffusion Rule also would have undermined U.S. diplomatic relations with dozens of countries by downgrading them to second-tier status," the U.S. Bureau of Industry & Security said in a statement.
The White House took aim at Chinese company Huawei, saying that buying its Ascend AI chips violates U.S. export controls.
Nvidia's new partnership with Saudi Arabia state-backed firm Humain to build AI infrastructure is giving shares an extra boost and underlining the potential for "sovereign AI" -- the company's term for AI being developed by governments or nations using their own infrastructure and data.
"Sovereign AI nicely complements commercial cloud investments with a focus on training and inference of LLMs [large language models] in local culture, language and needs, and could be 10-15% or $50bn+ annually in the longer-term $450-$500 billion global AI infrastructure opportunity," wrote BofA Research analyst Vivek Arya in a research note.
Arya raised his target price on Nvidia to $160 from $150, while reiterating a Buy rating on the stock.
The Trump administration is now considering a deal that would allow the United Arab Emirates to import 500,000 of the most advanced chips on the market each year from now to 2027, Bloomberg News reported, citing people familiar with the matter.
The Department of Commerce didn't immediately respond to a request for comment early on Wednesday.
Other chip shares were also advancing. Advanced Micro Devices rose 6%, and Arm Holdings was up 4.2%.
Write to Brian Swint at brian.swint@barrons.com and Adam Clark at adam.clark@barrons.com
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May 14, 2025 10:31 ET (14:31 GMT)
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