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Nvidia Stock Rises as Elon Musk Celebrates AI Milestone

Nvidia's stock surged over 2% in pre-market trading following Elon Musk's endorsement of the xAI Memphis Supercluster, the world's most powerful AI training facility.

1 min 56 secJuly 22, 2024
Nvidia Stock Rises as Elon Musk Celebrates AI Milestone

Nvidia’s stock saw a notable increase in pre-market trading on Monday, July 22. It rebounded from last week’s sharp 10% decline. What drove this sudden turnaround? Elon Musk’s endorsement of Nvidia’s pivotal role in xAI’s latest achievement.

 

Elon Musk Spotlights Memphis Supercluster AI Center

In a post on X, Elon Musk lauded the start of training for xAI’s Memphis Supercluster. “Nice work by xAI team X team, Nvidia & supporting companies getting Memphis Supercluster training started at ~4:20 am local time,” Musk wrote. He added “With 100k liquid-cooled H100s on a single RDMA fabric. It’s the most powerful AI training cluster in the world!”

 

 

The Memphis Supercluster, boasting 100000 of Nvidia’s H100 GPUs, is set to train the next version of xAI’s chatbot. Grok. These GPUs designed for training AI models, require immense energy and computing power.

 

In June the Greater Memphis Chamber confirmed the development of xAI’s “Gigafactory of Compute” at a repurposed manufacturing site. This highlights its economic benefits. xAI, boasting $6 billion in funding has begun hiring for roles such as fiber foreman. Also network engineer. However, local environmental groups have raised concerns about the facility’s energy and water consumption urging xAI to invest in a wastewater reuse system.

 

Nvidia Stock Surge

Following Musk’s announcement Nvidia’s stock rose by 2.26% to $120.58 in the pre-market session. FactSet data shows that from August 2020 to July 2024, Nvidia's stock has grown by 956%. However, it trails behind MicroStrategy’s 1339% surge in the same period.

 

 

Other tech stocks have also seen significant gains. Tesla has risen by 153%. Google has increased by 140% and Microsoft by 110%, with Amazon experiencing a modest 16% increase. Despite Nvidia’s recent 9.67% drop to $117.93, the overall market trend remains positive.

 

In conclusion, Musk’s endorsement of the Memphis Supercluster underscores Nvidia’s critical role in advancing AI technology. This provides a substantial boost to its stock and reaffirms its position in the tech market.

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