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Fed commentary could give a further shot in the arm to AI names that have been market leaders, but the broader semiconductor sector still faces challenges and skepticism.

The chip maker's shares have tended to pop after the Federal Reserve cuts interest rates, judging by data stretching back to 1999.

CEO Jensen Huang says the scale to grow AI from here will be exponential. The post Why Nvidia stock jumped after the big Fed rate cut appeared first on The Motley Fool Australia.

Nvidia’s stock historically has made dramatic moves in the year after initial Fed interest-rate cuts, and it has outperformed the S&P 500 on average when looking at all rate cuts since the IPO.

On Wednesday, the Federal Reserve trimmed interest rates aggressively and penciled in further rate cuts by the end of the year. It slashed the benchmark interest rate by a half-point to 4.75-5% for the first time since March 2020.