Chip Stocks Rally on AI Demand, Experts Warn of Overvaluation

Chip manufacturing stocks, including ASML and Lam Research, experienced significant gains on Friday, driven by renewed investor enthusiasm for AI-related investments. ASML's U.S. shares rose 4.6% to $1,413.01, while Lam Research jumped 8.3% to $231.01. This rally was spurred by hints of increased capital expenditure from major tech companies, signaling strong demand for semiconductors. However, market experts caution that the "AI build-out trade" may be becoming excessively pricey, raising concerns about potential volatility. Investors are also closely watching upcoming critical U.S. economic data, such as nonfarm payrolls and CPI, which could significantly influence market sentiment. The mixed outlook reflects robust demand against warnings of potential overvaluation in the sector.