Nvidia (NASDAQ: NVDA) up Nearly 5%: Here’s Why

Shares of Nvidia (NASDAQ: NVDA) are up 5%, or $6.25 on the day.

Fueling the upside is the announcement of a trade deal between the United States and China, which helped NVDA rejoin the $3 trillion market cap club.

NVDA has not been part of that club since February.

Granted, the chipmaker has underperformed the S&P 500 so far in 2025 due to macroeconomic uncertainties. However, with cooling trade tensions, NVDA could easily take the lead.

Additionally, the Trump Administration is set to scrap the AI Diffusion rule, which would have limited exports of Nvidia AI chips to most countries.

Plus, the AI spending scare was nothing more than an overreaction

All we have to do is look at what Microsoft and Meta just said on their earnings calls.

“Contrary to investors’ worries of slowing capex, it appears that spending for AI continues to be unabated,” Citi analyst Christopher Danely said, as quoted by CNBC. “AI infrastructure buildouts remain as key priorities for hyperscalers with the companies’ willingness to absorb the costs of tariffs. We view this as positive for AI-exposed stocks.”

Microsoft said its capex hit $16.75 billion in the third quarter. Moving forward, the company plans to spend $80 billion in 2025.

Meta also increased its 2025 capex to reflect an ‘increase in the expected cost of infrastructure hardware’ from suppliers around the world. According to reports, the company raised its 2025 capital expenditures to a range of $64 billion to $72 billion, up from its prior outlook of $60 billion to $65 billion.

That’s great news for stocks like Nvidia, too.

Morgan Stanley is Seeing Big Improvements in NVDA GB200 Shipments

According to Morgan Stanley, data out of Taiwan suggests there have been substantial improvements in Nvidia’s GB200 shipments.

“Our Taiwan ODM team is seeing close to 1500 racks shipped in the month of April across 3 ODMs, an important inflection that matches up with our NVDA estimates, and should ease investor concerns,” Morgan Stanley analyst Joseph Moore said, as quoted by Seeking Alpha.

Also, analysts at KeyBanc just reiterated their overweight rating on the NVDA stock with a $190 price target. According to KeyBanc, “NVIDIA’s decision to revert to the Bianca compute board, which consists of one CPU and two GPUs, from the previously planned Cordelia board, with two CPUs and four GPUs, is a positive development,” as noted by Investing.com.

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