NVIDIA surged, due to Blackwell and OpenAI, while institutions are actually underweight?

Blackwell's "crazy" demand and the possibility of further cooperation with OpenAI have led to a sharp rise in NVIDIA's stock price.

On Wednesday, October 2nd, Jensen Huang stated in an interview with CNBC that the upcoming Blackwell AI "super chip" has a "crazy" demand, with "everyone wanting the most, everyone wanting to be the first." According to the official website, products based on Blackwell will be shipped later this year to the cloud service departments of Oracle, Amazon, Microsoft, and Google.

NVIDIA's Blackwell chip will further solidify its leading position in the artificial intelligence market, while continuing to provide products and services to tech giants such as Microsoft, Meta, Alphabet, and Amazon.

On Wednesday, OpenAI announced raising $6.6 billion in new funding, bringing its total valuation to $157 billion. The Wall Street Journal reported that NVIDIA invested $100 million in this round of fundraising. Although the $100 million investment is relatively small compared to NVIDIA's staggering $2.9 trillion market value, the market sees this cooperation as a symbolic step that further strengthens NVIDIA's position in the field of artificial intelligence. After all, the launch of ChatGPT at the end of 2022 sparked an AI investment frenzy, helping NVIDIA join the ranks of the "Big Seven Tech Giants."

At the same time, this investment may also allow NVIDIA to gain a deeper understanding of OpenAI's chip procurement plans. NVIDIA's GPUs are the best way to power large language models like ChatGPT, but some competitors are working hard to narrow this gap.

Yesterday, NVIDIA's stock price reached $124.26 at one point, closing up 3.32% at $122.8. According to Forbes' valuation, Jensen Huang's net worth increased by $3 billion to reach $107 billion yesterday, making him the twelfth richest person in the world.

The stock prices of some competitors also rose yesterday. AMD rose by 1.9%, Broadcom rose by 0.7%, and Qualcomm rose by 0.4%.

However, the upward trend of NVIDIA and the semiconductor sector yesterday failed to lift the tech-heavy Nasdaq. The Nasdaq index closed down by 0.17%, while the S&P 500 index fell by 0.2%.

Nevertheless, many large investors are not overly bullish on NVIDIA. Although most actively managed funds tracked by Bank of America hold positions in NVIDIA, the relative weight in the funds is not considered aggressive.

Bank of America analysts pointed out that NVIDIA's relative weight is 0.99 times, much lower than the top 16 holdings in the information technology and communication services industries. The well-known financial blog Zerohedge also questioned in an article whether NVIDIA's stock price can break the record set in the second half of 2023 by the second half of 2024