The U.S. stock market had a rough start in September, with the Dow Jones Industrial Average falling by 2.93% this week, the S&P 500 dropping by 4.25%, and the Nasdaq Composite falling by 5.77%. Both the Dow and the S&P 500 experienced their largest weekly declines since March 2023, ending a three-week streak of gains, while the Nasdaq saw its largest weekly drop since January 2022.

Recently, chip stocks have been struggling. Intel, a direct competitor to Nvidia, has dropped nearly 9% from a one-month high, while AMD has fallen almost 8% to a three-week low. TSMC, the world's largest semiconductor foundry, saw its U.S. stock fall by 6.5%, and another major foundry, GlobalFoundries, declined by 8.6%. Semiconductor equipment manufacturers such as KLA dropped 9.5%, Applied Materials fell by 7%, and ASML decreased by 6.5%. Qualcomm dropped 6.9%, and Broadcom, which is set to release its third-quarter report on Thursday, fell more than 6%. Micron Technology also dropped about 8%, and ARM, which had bucked the trend and risen last Thursday while Nvidia fell, saw its stock decline by nearly 7%.

Despite Nvidia’s recent stock downturn, most analysts still maintain a "buy" rating on the company, suggesting that there is still room for stock price appreciation and that Nvidia’s long-term prospects remain positive. For instance, Tesla CEO Elon Musk has highlighted that despite recent investor concerns, demand for Nvidia’s existing product line remains strong. His AI startup, xAI, has successfully launched the Colossus AI training infrastructure in just 122 days, powered by 100,000 Nvidia H100 GPUs, and will integrate Nvidia’s H200 chips in the future, doubling its scale within a few months.

Here are some chip stocks that many analysts are particularly optimistic about:

NVIDIA: Recently, Nvidia’s CEO Jensen Huang revealed that demand for Blackwell chips is so high that it has led to a supply shortage. This statement caused Nvidia’s stock to surge in the short term and, more importantly, boosted investor confidence in the company's AI-related investments.

AMD: In the CPU battle of the second quarter this year, AMD stood out significantly, surpassing Intel and becoming a focal point in the market. While Cramer noted that Nvidia faces competition in the semiconductor sector, he asserted that AMD’s product demand remains strong and that AMD is a close competitor in the supercomputing market. He was also impressed with AMD’s performance in the recent quarter and the deals announced this summer.

Micron: Some investors consider Micron to be the "leader in the memory chip market," noting that large-scale data center builders need memory chips. Based on the company’s earnings forecast for the next fiscal year, some believe that the stock is currently undervalued.

Arm: Since its IPO a year ago, Arm’s stock has more than doubled, and the chip design company's licensing fees provide a predictable revenue stream. The stock rose on Monday following a report that Apple is developing a chip using Arm’s designs, likely for the iPhone 16.

How to trade investments on uSMART:

After logging into uSMART SG APP, click "Search" from the upper right corner of the page, enter the target code, such as "NVDA, and enter the details page to learn about transaction details and historical trends. Click "Trade" in the lower right corner and select "Buy/Sell" "Send" function, finally fill in the transaction conditions and send the order; the image operation instructions are as follows:

Source: uSMART SG

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