Nasdaq 100: Semiconductors Push Index to Record High as NVIDIA and Micron Surge

Semiconductors Push Nasdaq 100 to Record Close, S&P 500 Tracks Just Below Peak

Semiconductor stocks are leading U.S. markets higher, pushing the Nasdaq 100 to a fresh record and keeping the S&P 500 Index just shy of its all-time high. Investors are rotating into chipmakers on expectations of sustained demand from AI infrastructure buildouts.

NVIDIA’s $3.77 trillion market cap and Micron’s record $9.3 billion quarterly revenue underline the scale of the rally, with chip names now carrying outsized influence on both tech-heavy and broad-based benchmarks.

Is AI Capex Driving the Surge in Chip Demand?

The semiconductor sector is riding the largest coordinated capital spending cycle in tech history. Amazon, Microsoft, Google, and Meta will invest $320 billion in 2025, mostly targeting AI infrastructure. Global data center spending jumped 51% in 2024 to $455 billion and is projected to reach $1.1 trillion by 2029.

NVIDIA shipped over 4 million AI GPUs last year and is on pace for 7 million in 2025. With 78% of enterprises integrating AI into operations, hardware demand remains locked in—supporting a long growth runway for chipmakers.

How Are Manufacturers Scaling to Meet Demand?

Global chip manufacturing capacity is projected to hit 33.7 million wafers per month in 2025, a record high. TSMC is adding nine new fabs this year with up to $42 billion in capex.

U.S. government support through the CHIPS Act is funding major expansions by Intel, Micron, and others. Samsung plans to triple production by 2026. These moves reduce supply risk and enable a more resilient supply chain, directly supporting volume growth for companies tied to AI and enterprise computing.

What’s the Earnings Picture Across Leading Chipmakers?

Strong earnings are reinforcing investor confidence. NVIDIA posted $44.1 billion in Q1 revenue, including $35.6 billion from data centers. Micron’s DRAM and NAND units delivered 93% year-over-year revenue growth.

Broadcom’s 2024 revenue reached $51.6 billion, with AI-related sales up 220%. Robust free cash flow—NVIDIA at $36.9 billion, Broadcom at $27.8 billion—gives these firms capital for innovation and shareholder returns, supporting equity demand.

Do Analyst Targets Suggest More Room to Run?

Analysts remain constructive across the board. NVIDIA, Micron, and Broadcom hold Strong Buy ratings with double-digit upside targets. Sector forecasts show 9.5%-11.2% growth in 2025. With semiconductors now making up nearly 30% of S&P 500 sector weight and driving over a third of 2024’s index gains, their performance is critical to broader market direction.

Outlook: Will Semiconductor Strength Sustain Index Momentum?

Semiconductors are no longer just a tech sub-sector—they’re a market anchor. As AI adoption scales and capex continues to flow, chipmakers are well positioned to lead.

Traders should watch for Q2 earnings catalysts and AI hardware announcements as the Nasdaq 100 holds record ground and the S&P 500 eyes a potential breakout.

More Information in our Economic Calendar.