On Tuesday, shares of Nvidia surged nearly 7%, recovering from a three-session slump that had wiped approximately $430 billion from the market value of the artificial intelligence chipmaker.
Nvidia’s shares closed at $126.09, rebounding from a 13% decline from their June 18 close of $135.58. This drop followed a rally that intensified after a 10-for-1 stock split that took effect on June 10.
Nvidia’s rapid ascent and its position as the leading provider of chips for artificial intelligence applications have made it a symbol of this year’s tech-driven boom in U.S. stocks.
Last week, Nvidia briefly became the world’s most valuable company. Its shares have surged 154% this year, contributing nearly 30% of the S&P 500’s year-to-date return as of Monday’s close, according to S&P Dow Jones Indices. The index is up 14.6% this year.
The recent selloff has alleviated some concerns about Nvidia’s valuation, which now stands at about $3.1 trillion, down from a high of about $3.3 trillion earlier this month.
Bullish sentiment on Nvidia was also evident in the options market, though the stock’s recent price slide has made traders more cautious.
Nvidia call options, typically used to bet on a rising stock price, outnumbered puts by 1.4-to-1 over the last three sessions, according to Trade Alert data. This compares to a call-to-put ratio of 1.6-to-1 for the prior 10 sessions.
Meanwhile, Nvidia short sellers, who bet on declines in the stock, have gained $4.97 billion over the past three sessions, according to data analytics firm Ortex Technologies.
