Key Takeaways:
- Chip stocks surged Tuesday as a broad risk-on bid swept the semiconductor sector, with Intel and AMD each gaining 7% to cap a historic Q2 for AI names.
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Intel, AMD jump 7% as chip stocks ride AI bid into Q2 close
Chip stocks surged Tuesday as a broad risk-on bid swept the semiconductor sector, with Intel and AMD each gaining 7% to cap a historic Q2 for AI names.
The Nasdaq 100 climbed 1.65% to 30,293 as chip stocks caught a broad risk-on bid, with Intel and AMD each surging 7%. The S&P 500 added 0.76% to 7,509.50, while the Dow Jones Industrial Average rose 0.34% to 52,476.40. The Russell 2000 gained 0.48% to 3,023.82, reflecting broad participation in the rally.
"Customer engagement around the MI450 Series and Helios is strengthening, with leading customer forecasts exceeding our initial expectations," Lisa Su, chief executive officer of Advanced Micro Devices, said on the company's most recent earnings call.
Intel jumped 7% to $140.56, while AMD rose 7% to $577.13. The Direxion Daily Semiconductor Bull 3X Shares, a leveraged ETF that amplifies daily returns of a broad semiconductor index, surged 11% to $263.09. The move extended a historic run for AI infrastructure names: Intel is up 277% year to date, and AMD has gained 163%. Over the past 12 months, Intel has rallied 522% and AMD 298%.
The rally comes as both companies benefit from surging AI infrastructure spending. AMD's data center revenue reached $5.8 billion in its most recent quarter, up 57% year over year. Intel's data center and AI revenue totaled $5.05 billion, up 22%, with Chief Executive Officer Lip-Bu Tan flagging Intel's Xeon 6 as the host CPU for Nvidia's DGX Rubin NVL8 systems. The U.S. 10-year Treasury yield held steady as equities rallied, while the dollar index edged lower, providing additional support for risk assets.
The valuation backdrop remains demanding despite the momentum. AMD trades at 172 times earnings, while Intel's analyst consensus price target of $96 sits well below its current share price. Retail sentiment on AMD has turned bullish, with a composite reading of 60.68 on a scale of zero to 100, according to social media data. The SOXL ETF, which counts AMD, Broadcom, and Intel among its top holdings, has gained 16% over the past month even after a sharp pullback in late June.
The next scheduled earnings cycle for both companies will provide a more durable test of the AI trade. AMD's Q2 2026 revenue guidance of $11.2 billion is already on the table, and hyperscaler commentary on AI capital expenditure plans will be closely watched. With chip stocks having run so far so fast, position sizing remains a key consideration for investors.
This article is for informational purposes only and does not constitute investment advice.
