AI Stocks Soar as Nvidia Hits $4T, Apple Feels the Heat, and Musk Doubles Down – Daily Roundup
Market Rally Lifted by AI Mega-Caps
Wall Street kicked off the week on a strong note, with tech-heavy indexes hitting fresh highs amid the artificial intelligence frenzy. The Nasdaq Composite notched its seventh record close since late June reuters.com, edging up +0.27% on Monday. An index of the “Magnificent 7” mega-cap tech stocks – Apple, Microsoft, Alphabet (Google), Amazon, Nvidia, Meta, and Tesla – has rallied nearly 40% from its April lows advisorperspectives.com. This surge has been powered by AI optimism, as investors pour into leaders like Nvidia, Meta, and Microsoft advisorperspectives.com.
Nvidia (NVDA) in particular briefly touched a historic milestone last week, reaching a $4 trillion market capitalization – the first company ever to do so reuters.com. Shares of the chipmaker jumped to an all-time high of $164.42 on booming demand for its AI processors reuters.com. Nvidia’s value has tripled in about a year (after first hitting $1T in mid-2023), outpacing even Apple and Microsoft’s ascent reuters.com. “It highlights the fact that companies are shifting their spend in the direction of AI and it’s pretty much the future of technology,” said Dakota Wealth senior portfolio manager Robert Pavlik reuters.com. Nvidia’s stock is up about 22% year-to-date, rebounding ~74% from springtime lows reuters.com reuters.com. Rival Microsoft (MSFT), the second-most valuable U.S. company at $3.74T, also climbed to record territory, closing Monday at $503.51 reuters.com.
Other AI-linked giants are riding the wave. Meta Platforms (META) has gained over 20% in 2025 so far reuters.com, and Tesla (TSLA) – which skyrocketed last year – remains in focus with new AI initiatives (more below). Alphabet (GOOGL) is likewise hovering near all-time highs, even as investors keep an eye on its heavy AI spending. Notably, some big tech firms face shareholder pressure to ensure these AI investments pay off; major cloud players like Alphabet, Amazon, and Microsoft have been urged to rein in the huge costs of AI development reuters.com. Meanwhile, advanced chipmakers such as AMD (AMD) are rallying on the AI boom – AMD stock jumped 1.6% Monday to ~$146 fingerlakes1.com and has surged over 30% in the past month, buoyed by strong earnings and bullish analyst calls fingerlakes1.com. In Q1 2025, AMD’s revenue soared 36% year-on-year (with data center sales up 57% on its EPYC CPUs and Instinct AI GPUs) networkworld.com. This growth comes despite looming headwinds like a projected $1.5 billion revenue hit from U.S. export restrictions on selling advanced AI chips to China networkworld.com – a reminder of the geopolitical undercurrents shaping the sector.
Apple Under Pressure on AI Strategy
Not all tech titans are celebrating. Apple Inc. (AAPL) – a latecomer in the AI race – has seen its stock slump ~16% this year, erasing more than $630 billion in market value advisorperspectives.com advisorperspectives.com. This lag is fueling calls for Apple to shake up its approach to artificial intelligence. “Investors would turn more positive if Apple could acquire or invest a meaningful stake in an established AI provider,” argues Citigroup analyst Atif Malik advisorperspectives.com. Apple is famous for shunning large acquisitions (its biggest ever was the $3B Beats deal in 2014), but frustration is mounting over the slow rollout of AI features and talent retention. Some are urging bold moves: Dan Ives, a longtime Apple bull at Wedbush, calls the idea of Apple buying a major AI startup like Perplexity AI a “no brainer,” saying even a $30+ billion price tag would be “a drop in the bucket relative to the monetization opportunity Apple can achieve on AI” advisorperspectives.com.
So far, Apple’s AI enhancements (such as those unveiled at WWDC last month) have underwhelmed critics advisorperspectives.com. The company has reportedly even considered using external AI models to revamp Siri, breaking with its preference for in-house tech advisorperspectives.com. Kevin Cook, senior stock strategist at Zacks, believes Apple mostly needs “a refocus on AI talent” – noting this isn’t a Google-like situation where falling behind could instantly cede its market position advisorperspectives.com. Still, others warn Apple cannot afford complacency. Analysts at LightShed Partners wrote that “missing on AI could fundamentally alter the company’s long-term trajectory and ability to grow at all” advisorperspectives.com. There are signs of change: Bloomberg reports Apple’s executives have internally discussed an ambitious AI acquisition (indeed, Perplexity AI was rumored), and the company is undergoing a management shake-up (COO Jeff Williams retiring, CFO Luca Maestri already stepped down) advisorperspectives.com. Paul Meeks, an analyst at Water Tower Research, says Apple needs to do “something bold” to signal a course correction. “A significant deal would not only help them in AI, but show it is committed to a culture change… It can’t do AI on its own,” Meeks emphasizes advisorperspectives.com.
Meta’s Massive AI Bet – “Hundreds of Billions” for Superintelligence
Meta Platforms, the parent of Facebook and Instagram, is going all-in on AI infrastructure. CEO Mark Zuckerberg announced that Meta will spend “hundreds of billions of dollars” building several massive AI supercomputing data centers in a push toward artificial superintelligence reuters.com reuters.com. In a post on Meta’s new Threads platform, Zuckerberg detailed plans for multi-gigawatt AI data centers – including one codenamed Prometheus coming online in 2026, and another, Hyperion, that will scale up to 5 GW over time reuters.com. “We’re building multiple more titan clusters as well. Just one of these covers a significant part of the footprint of Manhattan,” Zuckerberg wrote, underscoring the sheer scale of Meta’s AI ambitions reuters.com. He pointed to industry analysis suggesting Meta is on track to be the first AI lab to bring a gigawatt-plus supercluster online reuters.com.
To justify this eye-popping spend, Zuckerberg noted Meta’s core advertising business remains strong, providing the “capital from our business to do this” reuters.com. Meta’s stock rose ~1% on the day of the announcement (and is up ~20% year-to-date) as investors digested the long-term vision reuters.com. Still, some analysts caution that such investment will take time to pay off. Gil Luria of D.A. Davidson said Meta is investing aggressively in AI because the tech is already boosting its ad targeting (allowing more ads sold at higher prices), “but at this scale, the investment is more oriented to the long-term competition to have the leading AI model, which could take time to materialize” reuters.com.
Meta recently reorganized its AI efforts into a new division called Superintelligence Labs after some setbacks with its open-source AI models and talent departures reuters.com. In fact, Meta has been waging a talent war in AI: the company just hired top AI minds like former Scale AI CEO Alexandr Wang and ex-GitHub CEO Nat Friedman to lead its supercluster lab, after Meta invested $14.3 billion in Scale AI last month reuters.com. The company also raised its 2025 capital expenditure budget to a whopping $64–72 billion to ensure it stays ahead of rivals like OpenAI and Google reuters.com. Zuckerberg’s message to investors is clear: Meta is determined not to be left behind in the race for AI dominance, and it’s willing to spend unprecedented sums to get there.
Chipmakers & Deals: Semiconductors, Software, and M&A
The AI gold rush is spurring major deals and partnerships across the tech landscape, especially in chips and enterprise software. In a blockbuster move for the semiconductor industry, Synopsys Inc. won Chinese regulatory approval for its proposed $35 billion acquisition of Ansys Inc., clearing the last hurdle for a deal that will cement Synopsys’ dominance in chip-design software advisorperspectives.com. Gaining Ansys (a leader in simulation tools) is expected to bolster Synopsys’ suite of design automation products crucial for developing AI chips – an area of strategic importance as demand for custom AI silicon explodes.
Meanwhile, a notable startup deal underscores the frenzy in AI coding and software development tools. Cognition AI, a rising AI software firm, announced an agreement to acquire Windsurf, a popular AI-driven software development platform reuters.com. The terms weren’t disclosed, but Windsurf brings in $82 million in annual recurring revenue and over 350 enterprise customers, along with a highly regarded engineering team reuters.com reuters.com. This acquisition comes just after Alphabet’s Google reportedly struck a $2.4 billion deal with Windsurf last week to secure talent and tech licenses reuters.com – highlighting how coveted AI talent has become. “Among all the teams in the AI space, Cognition was literally the one we have respected the most, and they are a perfect fit to bring Windsurf to the next phase,” said Jeff Wang, Windsurf’s interim CEO, in a memo to employees reuters.com. Cognition plans to invest heavily to integrate Windsurf’s coding tools into its own AI agent platform, even as Windsurf continues operating independently in the near term reuters.com reuters.com. (Notably, Windsurf had been in talks with OpenAI earlier this year about a potential $3B buyout reuters.com, illustrating the intense jockeying for AI startups.)
The semiconductor rivals to Nvidia are also angling for position. Advanced Micro Devices has emerged as the primary alternative for AI accelerators, and it’s seeing momentum with new product launches. AMD recently began shipping its Instinct MI350 GPUs and previewed a next-gen MI400 series for future AI servers, emphasizing an open ecosystem approach networkworld.com networkworld.com. Its data-center chip revenues are soaring (as noted earlier), and even PC chips are getting an AI twist – AMD’s latest Ryzen 300 series for laptops comes with built-in AI engines, tapping into the nascent “AI PC” market networkworld.com. Still, the geopolitical environment poses challenges: along with U.S. export bans on high-end AI chips to China (impacting both NVIDIA and AMD), other countries are following suit. For example, Malaysia just announced it will require special trade permits for any AI chips of U.S. origin, a move aimed at preventing tech transfer to sanctioned regions reuters.com. And in Europe, industry giants like Siemens and SAP are lobbying for a rethink of strict AI regulations that they fear could stifle innovation reuters.com. In short, while AI chip demand is red-hot, companies must navigate a minefield of trade tensions and regulatory scrutiny worldwide.
Musk’s xAI Gambit – Tesla to Weigh Investment
No daily AI roundup would be complete without Elon Musk, who is again intertwining his business empire with a grand AI project. Musk’s fledgling startup xAI – which he touts as developing a competitor to OpenAI’s ChatGPT – just secured a major ally (and perhaps soon, a sister company investor). Over the weekend, the Wall Street Journal reported Musk’s rocket company SpaceX will invest $2 billion in xAI as part of a larger $5 billion fundraising round reuters.com. This funding, one of the largest ever for an AI startup, would value xAI and its recent merger partner (more on that shortly) at around $113 billion yourstory.com. According to the report, the capital infusion is intended to help xAI’s “Grok” chatbot keep pace in the capital-intensive AI race reuters.com – an acknowledgement that competing with the likes of OpenAI and Google requires deep pockets.
Musk has now confirmed he plans to hold a Tesla shareholder vote on whether Tesla should also invest in xAI reuters.com reuters.com. The electric automaker’s CEO ruled out any outright merger between Tesla and xAI, but he clearly sees strategic value in tighter integration. “If it was up to me, Tesla would have invested in xAI long ago,” Musk quipped on his social media site X (formerly Twitter) reuters.com. Tesla’s annual shareholder meeting is set for November 6, where this proposal will likely be on the agenda reuters.com reuters.com. Already, Musk’s ventures have begun to overlap: xAI’s Grok chatbot is being rolled out in Tesla vehicles, and Tesla engineers helped Musk when he acquired Twitter (now X) in 2022 reuters.com. Earlier this year, xAI actually acquired Twitter (X) from Musk in a $33 billion deal, folding the social media platform into xAI’s umbrella and creating a combined group valued at $80B at the time reuters.com. The idea is to leverage X’s real-time social data and distribution channels to improve xAI’s models and reach reuters.com.
Analysts are cautiously optimistic about the Musk synergy. D.A. Davidson’s Gil Luria notes that Tesla already benefits from access to xAI’s advanced models (for example, in autopilot AI), “but could benefit from the startup’s rising value if it becomes a winner in AI” reuters.com. Essentially, taking an equity stake would give Tesla a financial upside as xAI grows, on top of any technical advantages. Musk himself has grand visions: he claims the latest version Grok 4 is “the smartest AI in the world,” and the new funding would go toward the massive compute and R&D needed to back that bold claim yourstory.com reuters.com. As one example of xAI’s direction, the startup announced a new “Grok for Government” suite this week, offering its AI models (including Grok 4) to U.S. federal and defense customers reuters.com reuters.com.
Government Tailwinds and Broader Context
Policymakers are increasingly in the mix as AI becomes a national priority. In Washington, President Donald Trump is preparing to unveil a $70 billion initiative to spur AI and clean energy investments reuters.com. He’s set to announce the plan – which includes funding for new data centers and power grid upgrades – at a July 15 event in Pittsburgh, alongside lawmakers pitching an “Energy and Innovation” summit reuters.com reuters.com. This comes as the U.S. government itself ramps up AI adoption: the Pentagon just awarded contracts worth up to $200 million each to leading AI companies OpenAI, Google, Anthropic, and Musk’s xAI, aimed at integrating advanced AI into defense operations reuters.com. “The adoption of AI is transforming the DoD’s ability to support our warfighters and maintain strategic advantage over our adversaries,” said the Defense Department’s Chief Digital and AI Officer, Doug Matty reuters.com. These contracts will fund “agentic AI” systems for national security use cases, and reflect a broader White House push (via an April executive order) for federal agencies to embrace AI reuters.com. Notably, Trump has also moved to roll back certain AI regulations, revoking a 2023 Biden-era order that required companies to disclose data to mitigate AI risks reuters.com. The message: the administration wants to accelerate AI innovation, even if it means loosening some oversight.
Geopolitical and macroeconomic crosswinds remain a background factor for AI investors. Global trade tensions have intermittently jolted markets – from Trump’s surprise 35% tariff on Canadian imports that briefly knocked stocks back last week finviz.com, to this weekend’s threat of new 30% tariffs on EU and Mexico if trade deals aren’t reached by August reuters.com. Thus far, markets have been relatively resilient (investors are “numb” to the tariff rhetoric, one Reuters report noted reuters.com), but any escalation could impact tech supply chains and costs. Also, with the Federal Reserve’s policy and interest rates in focus, richly valued AI stocks could face volatility if financing conditions change. For now, however, the broader market context is supportive: investors are looking past near-term noise and remain fixated on the earnings power and innovation of AI leaders. The S&P 500 just hit an all-time high last week finviz.com, and despite minor profit-taking, the index is up ~15% year-to-date – thanks in no small part to the AI-fueled rally in tech giants.
In summary, the AI sector entered the week of July 14, 2025 firing on all cylinders. Mega-cap tech stocks are driving indexes to record levels on AI enthusiasm, even as companies like Apple face scrutiny to catch up. Industry leaders are making eye-popping investments – from Nvidia’s $4T valuation milestone to Meta’s multi-billion-dollar AI superclusters – betting that today’s spending will secure tomorrow’s dominance. Semiconductor and enterprise software firms are consolidating and inking big deals to bolster their AI capabilities, while visionaries like Elon Musk are weaving together ventures (Tesla, X, SpaceX, xAI) to create AI ecosystems spanning consumer, enterprise, and even government arenas. Wall Street’s appetite for all things AI remains robust, though tempered by an understanding that regulatory, geopolitical, and competitive challenges lie ahead. For investors, the takeaway is that the “AI arms race” is accelerating on multiple fronts – and fortunes will be made (or lost) based on who executes best in this transformative tech boom reuters.com reuters.com. As one analyst put it, AI is “pretty much the future of technology,” reuters.com and the market is trading accordingly.
Sources: Major news outlets and analyst commentary, including Reuters, Bloomberg, Advisor Perspectives, and company reports reuters.com advisorperspectives.com reuters.com reuters.com reuters.com, among others.
