Advanced Micro Devices shares closed at $585.30 on Thursday, Nov. 12, up 30.3% from their close on Friday, Nov. 6, and Broadcom rose 24.1% to $364.36 over the same four sessions, according to Nasdaq data. Nvidia, whose chief executive Jensen Huang resigned this week, fell 11% to $166.19.

The split matters for investors in Asia because the region's chip suppliers sell to all three companies. A week of trading turned a scandal at the world's largest AI chipmaker into a rotation within the AI trade rather than a retreat from it. The PHLX Semiconductor Index rose 11.9% to 10,506.67 from Nov. 6 to Nov. 12, while Nvidia lost ground on three of the four days.

Capital Times has covered Nvidia's own share swings on Thursday separately. This article looks at the rest of the sector.

AMD and Broadcom lead the winners

The rotation began on Monday, Nov. 9, after reports about Huang's alleged relationship with a former executive of Singapore-based Megaspeed, an Nvidia customer under U.S. investigation over claims it helped Chinese firms get around export rules. AMD rose 13.3% and Broadcom 8.8% that day, MarketWatch reported, while Nvidia fell more than 4%. Monday was Broadcom's best day since its deal with Alphabet in November last year, MarketWatch said, citing Dow Jones Market Data. The PHLX index gained 6.9%, and Nvidia was the only one of its members to trade lower on the day.

The gains continued. AMD closed at $515.21 on Tuesday, $552.90 on Wednesday and $585.30 on Thursday, a 5.9% gain in the session when Nvidia formally announced Huang's departure. Broadcom added 5.5% on Thursday. Trading in AMD reached about 55.4 million shares on Thursday, Nasdaq data showed, up from 45.9 million on Wednesday.

Analysts quoted by MarketWatch were split on how far the shift could go. Seaport Research analyst Jay Goldberg said every chip company was exposed to the same kind of security risk, and expected rivals to add training for staff to guard against it. Morningstar analyst Brian Colello said scrutiny would rise across U.S. AI suppliers, but that Nvidia's market dominance "gives it the biggest bullseye."

Not every investor bought the trade. Stocktwits reported that investor Michael Burry wrote that AMD was rising on Nvidia headlines but that he would not trade it. Bank of America called the Nvidia situation a "new overhang, not yet an earnings event," according to the same report.

Memory and design stocks rise, then cool

Micron Technology and Arm Holdings rode the sector rebound for most of the week before giving back some ground on Thursday. Micron closed at $798.44, up 15.7% from Nov. 6, after falling 1.6% on Thursday from a $811.30 close on Wednesday. Arm ended at $199.78, up 14.4% for the four sessions, after a 1.8% decline on Thursday.

Both stocks had been among the hardest hit in the selloff after the U.S. midterm elections. On Thursday, Nov. 5, Micron closed at $656.39 and Arm at $166.72, and the PHLX index ended that day at 9,011.14, its lowest close of the period, Nasdaq data showed. The iShares Semiconductor ETF fell 12.2% on Nov. 5, its worst fall in more than six years, Stocktwits reported. From that low, the PHLX index has recovered 16.6%.

Super Micro and Microsoft lag

The biggest loser among large AI names on Thursday was Super Micro Computer, the server maker that builds systems around Nvidia chips. Its shares fell 11.3% to $26.99, leaving them down 6.2% from Nov. 6. About 115 million shares changed hands, nearly three times Wednesday's 42.9 million, according to Nasdaq data. MarketWatch noted earlier in the week that the Megaspeed case followed allegations this year that a Super Micro executive had evaded U.S. export rules to divert Nvidia chips to Chinese firms.

Microsoft, one of the largest buyers of AI chips, missed the rally. Its shares closed at $523.00 on Thursday, up 0.4% on the day but down 1.4% from Nov. 6.

The broader indexes rose less than the chip index. The Nasdaq Composite ended Thursday at 25,366.09, down 0.4% on the day and up 3.2% from Nov. 6. The Nasdaq-100 closed at 28,289.19, a gain of 4.8% over the four sessions. The PHLX index slipped 0.5% on Thursday.

Policy remains a risk for the whole group. Raymond James analyst Ed Mills pointed to a bipartisan Senate proposal, the MATCH Act, that would further limit sales of chipmaking equipment to China, MarketWatch reported. AMD sells older MI308 chips to some Chinese customers, and Broadcom, like Nvidia, sells high-end switches used in Chinese data centers, according to the same report.

Nvidia reports quarterly results on Nov. 17, its first under interim chief executive Colette Kress. Those numbers will test whether this week's move into AMD and Broadcom holds.