Nvidia’s stock historically has made dramatic moves in the year after initial Fed interest-rate cuts, and it has outperformed the S&P 500 on average when looking at all rate cuts since the IPO.

The chip maker's shares have tended to pop after the Federal Reserve cuts interest rates, judging by data stretching back to 1999.

As a result, Broadcom and Nvidia are positioned to benefit for years as the AI industry expands from 2023's global market size of $136 billion to an estimated $827 billion by 2030. This is one reason owning shares in both is a great way to invest in the secular trend of AI.

The more than $200 billion rally came after Huang said the company’s customers are “emotional” and “tense” due to their desire for more of Nvidia’s high-tech products.

On Wednesday, the Federal Reserve trimmed interest rates aggressively and penciled in further rate cuts by the end of the year. It slashed the benchmark interest rate by a half-point to 4.75-5% for the first time since March 2020.

But Nvidia isn't the only AI chip stock in the market. And CEO Jensen Huang just explained why another company may be worth owning, perhaps even more so than his own company. Image source: Getty Images.