NVIDIA (NVDA) stock jumped more than 4% on Wednesday to help lead the tech sector and some chip stocks higher following Trump’s announcement of a massive $500 billion AI infrastructure project.
The project is creating a company called Stargate, which will initially be funded by SoftBank (SFTBY), OpenAI, Oracle (ORCL) and MGX, based in the United Arab Emirates.
Stargate named Nvidia, alongside Microsoft (MSFT) and British chip designer Arm (ARM), as “key initial technology partners” in the project, which aims to build the U.S. data centers needed to power artificial intelligence. OpenAI said Stargate would “start rolling out $100 billion immediately” and invest up to $500 billion over the next four years.
Nvidia’s gain on Wednesday pushed its market capitalization to $3.6 trillion, once again making it the world’s largest company after Apple (AAPL).
Meanwhile, Microsoft shares rose nearly 4% Wednesday morning, while Arm jumped more than 14%. Oracle stock rose 7% and SoftBank rose more than 10%.
“Stargate will build the physical and virtual infrastructure to power the next generation of AI advancements, and that will include building colossal data centers, very, very massive structures,” Trump said during a briefing Tuesday. “These buildings, they’re big, beautiful buildings that are going to employ a lot of people.”
Trump said the effort was aimed at maintaining the U.S. lead in developing artificial intelligence ahead of China.
The announcement follows a series of executive orders from the Biden administration on artificial intelligence last week aimed at limiting the flow of AI chips to China and speeding up the construction of data centers in the United States.
“This comes at a critical time as we expect Trump to aggressively seek more investment in AI in the United States,” Wedbush analyst Dan Ives wrote in a note to investors Tuesday evening. Ives noted that the project “is part of a broader game of high-stakes poker with China.”
After the announcement, Elon Musk aims for OpenAI on his social media platform X. In response to a post from OpenAI about Stargate, he wrote: “They don’t really have any money.”
OpenAI it is estimated that he lost $5 billion in 2024, but generated only $3.7 billion in revenue.
Tech stocks across the board rallied following the announcement of a major investment in AI. Dell (DELL) and Super Micro Computer (SMCI), which make servers using Nvidia chips, grew about 4%.
Laura Bratton is a reporter for Yahoo Finance. Follow her on Bluesky @laurabratton.bsky.social. Email her at laura.bratton@yahooinc.com.
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