Following a sharp decline in semiconductor stocks, which saw the iShares Semiconductor ETF drop 6.4% on Wednesday and 5.6% on Thursday, investors are now engaging in a 'revenge' trade, according to CNBC's Jim Cramer.
This rebound comes after concerns were raised about potential shifts in AI chip supply dynamics, particularly after a report indicated that Anthropic is considering a custom AI chip with Samsung Electronics. Major companies like Micron, AMD, and Marvell Technology experienced significant losses, but by Monday, stocks such as Intel, Arm, and Broadcom saw increases of over 3%.
Cramer highlighted Broadcom's extended partnership with Apple, which is crucial for its long-term growth. He expressed confidence in Broadcom's prospects, noting its role as a key design partner for major clients like Google.
In contrast, Nvidia, previously a leader in AI chips, is facing challenges due to delays in its next-generation server system, leading Cramer to suggest that its current valuation may not reflect its potential upside