Nvidia shares score gains on potential AI 'arms race' boost
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Nvidia (NASDAQ:NVDA) shares climbed more than 5% Tuesday following some upbeat comments from Bank of America analyst Vivek Arya about the chipmaker's potential gains from advances in artificial intelligence technology.
Nvidia (NVDA) advanced as Arya said the company's data center business stands to see big sales gains from growing demand for AI tech and services. Arya said that an AI "arms race" could spur Nvidia's (NVDA) data center sales to rise by four times their current levels in the next five years. 
Arya cited Nvidia's (NVDA) "full stack" of accelerated silicon, systems, software and developers as putting the company in a position to "lead the nascent generative AI arms race among global cloud and enterprise customers." As such, Arya raised his price target on Nvidia's (NVDA) stock to $255 a share from $215, and left his buy rating on the stock intact.
This year has been a good one for Nvidia (NVDA) and its investors, as the company's shares have risen 46% since the end of 2022. Arya said that while in the near term "we could see some stock volatility" following Nvidia's (NVDA) share price gains, any pullback in the stock should be "short lived" as investors ready themselves for the company's GTC conference in March.
Along with Nvidia (NVDA), gains also came from Advanced Micro Devices (AMD) up by more than 3%, while Qualcomm (QCOM), Applied Materials (AMAT) and Broadcom (AVGO).
Companies playing directly in the AI market also flexed their muscles Tuesday. C3.ai (AI) shares rose 2.6%, Big Bear Ai (BBAI) was up by almost 3% and SoundHound (SOUN) rose 2.4% as trading progressed.
For its part, C3.ai (AI) rebounded a bit from big losses on Monday that resulted from reports that some U.S. legislators were looking at new ways to regulate the AI industry.