Asian semiconductor stocks rise after shares of AI chip darling Nvidia hit a record high overnight

Asian chip stocks rose on Tuesday after Nvidia closed at a record high overnight as the chip company continues to ride the massive artificial intelligence wave.

Stocks tied to Nvidia suppliers as well as other chip companies advanced as the bullish investor sentiment spilled over. Shares of South Korean chipmaker SK Hynix, which manufacturers high bandwidth memory chips for AI applications, for Nvidia surged 2.5%.

Samsung Electronics, which is expected to be manufacturing HBM chips for some Nvidia products, saw its shares rise 0.5%.

Shares of Taiwan Semiconductor Manufacturing Company and Hon Hai Precision Industry — known internationally as Foxconn — which are part of the Nvidia supply chain, jumped about 2% and 2.5%, respectively.

Japanese semiconductor manufacturing firm Tokyo Electron surged 5%, testing equipment supplier Advantest gained 3.6% and Renesas Electronics rose over 4%.

Japanese technology conglomerate SoftBank Group, which owns a stake in chip designer Arm, jumped as much as 6.4%.

Overnight on Wall Street, Nvidia shares rose 2.4% to close at $138.07, surpassing their June 18 high of $135.58,lifting its market value to $3.4 trillion, unseating Microsoft as the second most valuable company on Wall Street after Apple.

The surge in Nvidia shares Monday came as Wall Street heads into the earnings season. Most of the chipmakers’ top customers have unveiled technologies and products that require hefty investment in Nvidia’s graphics processing units, or GPUs.

U.S. big tech companies Microsoft, Meta, Google and Amazon have been purchasing Nvidia’s GPUs in massive quantities to build growing clusters of computers for their advanced AI work. These companies are set to report quarterly results by the end of October.

The rapid surge in Nvidia shares has helped it recoup earlier losses following the company’s second-quarter earnings. Its shares sank in late August even as Nvidia earnings topped analysts’ expectations but it’s gross margins dipped.

Nvidia shares are now up almost 180% this year.