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Nvidia closes with $2 trillion valuation as Dell stokes AI rally

FILE PHOTO: NVIDIA logo shown at SIGGRAPH 2017

By Noel Randewich

(Reuters) -Nvidia's stock market value closed above $2 trillion for the first time on Friday after an upbeat report from Dell Technologies reignited Wall Street's AI-fueled rally.

Nvidia's stock added 4% after Dell, which sells high-end servers made with Nvidia's processors, gave an upbeat forecast late on Thursday, pointing to a surge in orders for its AI-optimized servers.

Dell's shares soared as much as 38% to a record high before ending the session with a 32% gain.

Friday's rally put Nvidia's market capitalization at $2.06 trillion, making it Wall Street's third most valuable company behind Microsoft and Apple, at $3.09 trillion and $2.77 trillion, respectively.

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Super Micro Computer, another company that sells servers made with Nvidia's chips, jumped 4.5%.

Other chipmakers exposed to AI rallied to record highs, with Broadcom and Marvell Technology each up about 8%, while Advanced Micro Devices climbed over 5%.

The PHLX chip index rallied 4.3% to its own record high, lifting its 2024 gain to 18%.

Nvidia controls about 80% of the high-end AI chip market, with customers including ChatGPT creator OpenAI, Microsoft, Alphabet and Meta Platforms snapping up tight supplies of its components to compete in the fast-emerging generative AI sector.

The company has recently become Wall Street's most traded stock by value, day to day, replacing Tesla. Investors exchanged $36 billion worth of Nvidia's stock on average over the past 30 sessions, compared to $21 billion a day for Tesla.

Trading in Nvidia on Friday reached $38 billion worth of shares.

On Feb. 23, the Santa Clara, California-based company added $277 billion in stock market value in just one session, a Wall Street record, after it forecast a roughly threefold surge in quarterly revenue.

Nvidia's stock has now risen 66% in 2024 after more than tripling last year. Last month, its stock market value overtook Amazon and Alphabet.

A week ago, Nvidia's stock market value edged above $2 trillion for the first time before receding by the end of the session.

Saudi Aramco has a $2.045 trillion market capitalization, although over 90% of it is closely held by the government of Saudi Arabia and less than 2% of its shares are available for trading by investors, according to LSEG data.

(Reporting by Noel Randewich; Editing by Kirsten Donovan and Will Dunham)