Tech Stocks Surge $200B on AI Optimism, OpenAI Hits $500B
Tech stocks soared to new heights, with global chipmakers adding a staggering $200 billion to their market capitalization in a single day. This surge was driven by AI optimism, with OpenAI's valuation, which owns ChatGPT, reaching $500 billion. However, some experts caution about inflated valuations and lack of revenue from mainstream AI services.
The AI sector's momentum has sparked a bull market in technology stocks. Intel is in talks to win AMD as a customer, while European chip equipment maker ASML saw its share price increase by up to 4.9%. OpenAI, the owner of ChatGPT, reached a record valuation of $500 billion due to an employee stock sale and agreements with South Korean chipmakers. This has led to a surge in Korean chip stocks, pushing the Kospi index to a record high.
The gains were not limited to a few companies. Broadcom alone added over $200 billion USD to its market value following a $10 billion AI chip deal. Samsung Electronics and SK Hynix also showed significant stock price increases due to partnerships related to AI chips. The combined market capitalization of the Philadelphia Stock Exchange Semiconductor Index and an Asian chip stocks index increased by more than $200 billion in the last trading session.
Analysts attribute this bull market to the 'fear of missing out', with investors largely ignoring bubble fears in the AI sector. Peter Kim, Managing Director at KB Securities, expects Asian technology stocks to continue performing well, with no significant headwinds anticipated until next year.
While the AI-driven tech stock boom continues, JPMorgan Asset Management warns that a sell-off could occur if mega-tech companies' profits deteriorate, given their high valuations. Some market observers express concern about the disconnect between inflated valuations and mainstream AI services' revenue generation, suggesting a cautious approach despite the current euphoria.
