Nvidia stock (NVDA) rose on Tuesday, extending a recent rebound as renewed optimism surrounding artificial intelligence infrastructure lifted semiconductor stocks and helped drive US equities to fresh record highs.
The stock gained 2.3% to $211.48 in early trading after climbing 2.9% in the previous session.
Other chipmakers also advanced sharply, with Advanced Micro Devices and Intel each rising around 9%.
The broader market rallied as easing oil prices and stronger-than-expected corporate earnings boosted investor sentiment.
The S&P 500 rose 1.8% to a record intraday high, its first since June, while the Nasdaq Composite gained 2.5%.
The Dow Jones Industrial Average climbed 1,035 points, or 2%, led by a 6% gain in Caterpillar.
The advance came as hopes grew that the Strait of Hormuz could reopen, contributing to another decline in oil prices.
Nvidia rebounds but continues to trail peers
Despite the recent recovery, Nvidia has lagged the broader semiconductor sector this year.
The shares have gained 11% in 2026 and are up 16% over the past 12 months.
By comparison, the PHLX Semiconductor Index had risen 61% this year through Monday’s close and added another 6% in Tuesday trading.
Investors have increasingly broadened their exposure across the semiconductor industry as spending on AI infrastructure expands beyond graphics processing units.
While Nvidia remains the dominant supplier of AI accelerators, competition has intensified from AMD and custom chip developers, as well as companies focused on central processing units, including Intel.
The company’s relative underperformance has left Nvidia trading at lower valuation multiples than many of its semiconductor peers.
According to FactSet, Nvidia trades at a forward price-to-earnings ratio of 18.9 times, below the S&P 500’s forward multiple of about 20 times.
The PHLX Semiconductor Index trades at an average forward multiple of 20.6 times, while Intel trades at about 50.4 times forward earnings and AMD at approximately 43 times.
Investors use price-to-earnings multiples to assess a company’s valuation relative to the earnings it is expected to generate.
With the growth of online trading apps, tracking such metrics has become significantly easier and more accessible to market participants.
The comparatively lower valuation has led some investors to view Nvidia as increasingly attractive following the recent selloff.
Financing concerns remain in focus
Tuesday’s gains extended Nvidia’s recovery after several weeks of pressure driven by concerns over artificial intelligence spending, financing arrangements, and rising competition in the semiconductor industry.
Investor sentiment had also weakened following reports that a Chinese company had begun mass-producing key chipmaking equipment, raising questions about future competitive dynamics.
Separately, The Wall Street Journal reported that Nvidia is discussing a roughly $250 billion financing guarantee to support OpenAI’s lease of a large data centre project in Ohio.
The proposed arrangement would help OpenAI secure more favourable financing while supporting long-term demand for Nvidia’s AI processors.
However, the report also raised concerns among some investors that financing agreements between Nvidia and its customers could resemble the circular financing structures seen during the dotcom era.
The latest rally suggests investors are once again focusing on the long-term outlook for AI infrastructure demand, even as competition broadens and questions remain over how future spending will be distributed across the semiconductor industry.
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