AI stocks lead market rebound as tech rotation reverses; Nvidia, Amazon, and TSMC positioned for growth

Investors have rotated back into technology and AI stocks after a period of favoring value-oriented names, with the Nasdaq index rallying to new highs.

Nvidia is evolving beyond GPU manufacturing into a complete AI infrastructure provider for both inference (where AI produces answers) and agentic AI (AI that makes decisions and takes actions). Amazon's custom chip business reached a $20 billion run-rate, or $50 billion including internal use, and includes chips for training and inference. Taiwan Semiconductor Manufacturing benefits from hyperscalers using more chip suppliers and from demand for GPUs, CPUs, and ASICs (application-specific integrated circuits).

Amazon's stock has regained momentum after years of underperformance, supported by accelerating growth in its cloud computing segment and cost advantages from its chip business. TSMC's near-monopoly on advanced logic chip manufacturing gives it strong pricing power amid rising demand.