Nvidia’s Blowout Forecast Puts AI Stocks Back in Rally Mode

CNBC and Nvidia contributed to this report.

Stock futures climbed Thursday after Nvidia’s latest earnings blowout reignited enthusiasm for everything tied to artificial intelligence.

Dow futures were up about 0.6% (roughly 250 points), S&P 500 futures added 1.1%, and Nasdaq 100 futures jumped around 1.4% as traders piled back into big tech.

Nvidia surged nearly 5% in premarket trading after the chipmaker smashed Wall Street estimates and guided even higher for the current quarter. Revenue hit a record $57 billion in the third quarter, up 62% from a year ago, with data center sales alone reaching $51.2 billion. The company forecast about $65 billion in sales next quarter and CEO Jensen Huang said demand for its new Blackwell chips is “off the charts,” brushing off talk of an AI bubble.

That was enough to jolt the wider AI trade back to life. Chip peers AMD and Broadcom climbed in premarket trading, while the VanEck Semiconductor ETF (SMH) rose more than 2%, boosted by gains across the sector. Other AI hardware names like Taiwan Semiconductor and Super Micro Computer also moved higher.

The rally spread overseas too, with European chipmakers such as ASML, ASMI and BESI, and Asian giants Samsung and Foxconn all trading higher as investors bought back into the AI story.

Still, some on Wall Street are staying cautious.

“Nvidia’s numbers remain extremely strong now, but there are inevitably questions whether Huang’s company has already reached its high-water mark in terms of growth and market share,” said David Russell of TradeStation.

Others, like “Big Short” investor Michael Burry, are still warning about aggressive assumptions on chip depreciation and the risk that data centers built on heavy debt could struggle if demand cools.

Nvidia’s results land in a jittery macro backdrop. Minutes from the Federal Reserve’s October meeting showed officials split over whether weakening labor data or sticky inflation is the bigger risk. Futures markets now see only about a one-in-three chance of a rate cut at the Fed’s December meeting, down sharply from a month ago.

Later Thursday, investors will get another key piece of the puzzle when September’s nonfarm payrolls report finally drops after being delayed by the government shutdown. Between Nvidia’s monster print and fresh jobs data, markets are set for a busy, AI-flavored trading day.