Backed by a broad semiconductor sector rally, Broadcom Inc.'s (AVGO, Financial) shares soared 24% on Friday to push its market valuation to a new trillion mark. It comes after the rally posted a strong earnings report that featured a 51% annual revenue growth to $14.05 billion, fueled by a 220% increase in AI-related revenues. According to the company, the sales value of this AI chip market could hover around $90 billion by fiscal 2027.
U.S. stocks finished a subdued week with a mixed close. Investors also cheered Broadcom, boosting the stock into the New York Stock Exchange's list of best performers after its earnings beat expectations and the broader technology sector got some momentum. However, the S&P 500 and Dow Jones Industrial Average bowed lower, each posting a weekly decline of 0.16% and 0.20%, respectively.
Marvell Technology (MRVL, Financial) rallied 10.8%, while Nvidia (NVDA, Financial) declined 2.2%. The semiconductor index (SOX) increased broadly by 3.2% as investors continued to show faith in AI and tech innovation; after an in-line inflation print, traders are backing a 97% probability of a 25 basis point cut at the Federal Reserve meeting next week.
Other gainers included RH (RH, Financial), whose shares soared almost 17% after a strong quarterly revenue report, and D.R. Horton (DHI, Financial), which lost 0.89% after a downgrade by J.P. Morgan. While declines are outpacing advancers on the NYSE, tech stocks delivered resilience, and the Nasdaq climbed above 20,000 mid-week for the first time.
