What Happened?
Shares of semiconductor designer Lattice Semiconductor (NASDAQ: LSCC) jumped 12.7% in the afternoon session after the VanEck Semiconductor ETF jumped nearly 5% in response to the de-escalation of the U.S.-Iran conflict.
The sector rallied specifically because semiconductors were highly vulnerable to the supply chain disruptions that occurred during the war. The reopening of the Strait of Hormuz is a critical victory for the industry, as the waterway is essential for the transit of noble gases and materials used in chip fabrication.
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What Is The Market Telling Us
Lattice Semiconductor’s shares are extremely volatile and have had 31 moves greater than 5% over the last year. But moves this big are rare even for Lattice Semiconductor and indicate this news significantly impacted the market’s perception of the business.
The previous big move we wrote about was 8 days ago when the stock gained 4.8% on the news that Nvidia announced a strategic partnership and a $2 billion investment in fellow chipmaker Marvell Technology.
Following the news, Marvell's stock surged 6.9%, while Nvidia's shares also climbed, providing a lift to the broader semiconductor sector. The collaboration aims to connect Marvell to NVIDIA's AI ecosystem through its NVLink Fusion technology, giving customers more flexibility in developing advanced infrastructure. This significant investment by the AI chip leader stressed the continued rapid expansion and high-stakes competition within the artificial intelligence hardware industry, boosting investor confidence across the sector.
Lattice Semiconductor is up 38.1% since the beginning of the year, and at $108.65 per share, has set a new 52-week high. Investors who bought $1,000 worth of Lattice Semiconductor’s shares 5 years ago would now be looking at an investment worth $2,168.
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