- IBM's shared gained 15% in premarket trading after an old clip of Trump praising its CEO resurfaced.
- IBM signed a partnership with the US Commerce Department last month.
- IBM would get $1 billion to set up a company for manufacturing quantum chips.
Shares of several software companies surged after Nvidia announced a new chip for personal computers, directly challenging firms like Intel and AMD. However, for IBM, a stock rally wasn't just linked to a broader rally of software stocks.
On Monday, shares of the tech giant jumped as much as 15% in premarket trading after a video of US President Donald Trump praising IBM's CEO resurfaced on social media during the weekend, as per investing.com.
Multiple accounts, including Polymarket Money, shared the clip on social media X over the weekend. The clip, originally from an event in December, featured Trump saying that IBM's stock was “going to go up a lot more.”
The clip shows Trump praising IBM CEO Arvind Krishna for taking the stock to a “very nice” valuation. Trump added that he would not call the current price high since Krishna would likely say the stock's value would increase further.
The surge in IBM's shares follows a 33% jump in Dell stock on Friday, which gained attention on social media after being seen as a company favoured by Trump.
IBM's Partnership With Commerce Department
Last month, the US Department of Commerce announced that IBM would get $1 billion to set up a company to manufacture quantum chips. The tech giant was among the nine quantum-computing companies that the US government would take equity stakes in.
IBM said that its new company, Anderon, will become America's first dedicated quantum chip manufacturing facility. It did not reveal the government's stake in Anderon, which will be based in New Albany, New York.
The funding will be drawn from incentives under the CHIPS and Science Act signed by former President Joe Biden, as per Reuters.
In addition to the US Commerce Department, IBM will contribute $1 billion to Anderson. It will also provide workforce, intellectual property and assets to Anderon as well as bring in more investors as the firm grows.
On Monday, shares of ServiceNow soared 14.4%. Hewlett Packard's stock rose 12.6% while ARM's shares rose 12.2%, as per CNBC. Nebius also added over 2% to its value.
However, Intel, another firm in which the US government owns an almost 10% stake, reacted negatively to Nvidia's news. Intel's stock fell almost 6% before the trading bell.
