The tech world is buzzing with the latest developments in artificial intelligence (AI) and its impact on the stock market. But Nvidia's journey in this arena is not without its twists and turns.
Nvidia's Stock Volatility:
Nvidia, the AI chip powerhouse, experienced stock fluctuations on Wednesday following a significant deal. British data center operator Nscale's decision to supply 200,000 Nvidia AI processors to Microsoft and Dell Technologies' collaboration on the project has caught investors' attention.
This deal expands Nscale's AI infrastructure partnership with Microsoft. Nscale's largest project involves providing 104,000 Nvidia GB300 GPUs to a Texas data center campus, starting in Q3 2026. Nscale is also constructing AI data centers in Norway, Portugal, and the U.K., as per their news release.
But here's where it gets interesting: Nvidia's stock price initially rose by 2.7% to 184.87 during the trading session but later fell slightly to 179.81. This movement occurred just above its 50-day moving average line, a critical technical indicator.
AI Megatrend and Nvidia's Role:
Nvidia is at the forefront of the AI revolution, providing essential tools for the AI gold rush. However, the company's involvement goes beyond chip supply.
Controversial Partnerships:
Nvidia is an investor in Nscale, alongside Dell and Nokia. But that's not all—Nvidia is also part of a $40 billion acquisition deal for Aligned Data Centers, based in Texas. The buyers, AIP and BlackRock's Global Infrastructure Partners, have a complex structure, with founders like BlackRock, MGX, Microsoft, and Nvidia, and anchor investors including the Kuwait Investment Authority and Temasek.
This transaction, expected to close in early 2026, involves a massive portfolio of 50 data center campuses and over 5 gigawatts of capacity across the U.S. and Latin America.
Market Reactions and Upgrades:
In a surprising move, investment bank HSBC upgraded Nvidia stock to 'buy' and increased its price target significantly. HSBC analyst Frank Lee believes Nvidia's AI processors will find demand beyond hyperscalers, ensuring sustained earnings growth.
Nvidia's stock is now on multiple IBD lists, including Stock Spotlight, Sector Leaders, and Tech Leaders.
And this is the part most people miss—the AI chip landscape is evolving rapidly, with Nvidia at the center of it all. Will this acquisition strategy pay off, or are there hidden risks? Share your thoughts in the comments below!
