Shares of Intel and AMD surged approximately 8% on Monday, extending a sharp rebound from last week's selloff, as a drop in crude prices and easing Treasury yields improved the broader market mood. AMD touched a 52-week high of $609.50, bringing its market valuation closer to the $1 trillion threshold, while Intel posted its strongest multi-day gain in months.
The rally was fueled by a combination of macro tailwinds and renewed confidence in artificial intelligence infrastructure spending. U.S. crude fell about 3% to $96.56 per barrel, and Brent slipped more than 3% to $100.72, easing concerns that higher energy costs could feed into inflation and prompt more aggressive Federal Reserve action. Meanwhile, the 10-year Treasury yield dipped below the closely watched 5% level, reducing pressure on high-growth technology stocks that are sensitive to borrowing costs.
Investors had grown worried last week that a potential slowdown in AI development could eventually dampen demand for processors, accelerators, and memory chips. However, fresh data points suggest that spending on AI infrastructure remains robust. According to a Financial Times report, OpenAI expects to burn through $278 billion in cash between 2026 and 2030 as it ramps up computing power, with revenue projected to jump from $36 billion this year to $350 billion by 2030. The company also anticipates cumulative revenue of $840 billion through the end of the decade, signaling sustained demand for advanced chips.
In addition, Reuters reported that Anthropic is considering launching a new AI model to counter OpenAI's GPT-6 Astra, even as its CEO has called for a slowdown in AI development. The potential release comes as Anthropic prepares for an initial public offering, further underscoring the competitive intensity in the AI space.
Bank of America analyst Vivek Arya added to the optimism, forecasting that the semiconductor industry's total addressable market will reach $3.2 trillion by 2030, up from an estimated $1.7 trillion this year. Arya noted "no signs of slowing" in customer orders, long-term agreements, supply commitments, and chip pricing, despite recent volatility in semiconductor stocks. He identified Intel as one of the names likely to benefit as semiconductor momentum strengthens.
Intel also received a fresh wave of Wall Street bullishness. Melius Research initiated coverage with a Buy rating and a $165 price target, implying roughly 51% upside from Friday's close. Analyst Ben Reitzes outlined a potential path to $200 over the next two years, driven by the success of Intel Foundry Services and its advanced 14A manufacturing node. The thesis assumes high-volume production can accelerate by 2028, supported by commitments from major customers such as Apple and Tesla. Tigress Financial also raised its Intel price target to $145 from $118, describing the company as being in an "accelerating AI-driven turnaround."
Intel's manufacturing ambitions received a further boost from reports that SK Hynix is in talks to bring memory-chip production to Intel's delayed Ohio site. Such a deal could strengthen Intel's foundry business and help it regain ground in the global semiconductor supply chain. For more on this, see SK Hynix's denial of a confirmed deal and the broader chip rally.
AMD's gains were supported by improving investor confidence in its product pipeline. Piper Sandler reiterated an Overweight rating and a $600 price target following the company's pre-quiet period call, with analyst David O'Connor noting that CPU and GPU product ramps are progressing as planned. The positive commentary helped dispel concerns about AMD's competitive position against Nvidia and Intel.
The broader chip sector also benefited from a rebound in risk appetite, as seen in chip stocks rebounding and Dow futures surging. While some investors remain cautious about the sustainability of AI-driven growth, the latest data and analyst commentary suggest that demand for computing infrastructure remains strong.
This article is for informational purposes only and does not constitute financial advice.
