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

Fed commentary could give a further shot in the arm to AI names that have been market leaders, but the broader semiconductor sector still faces challenges and skepticism.

Worries around a slow payoff from AI investments have mounted, and Nvidia's forecast fell short of expectations despite strong quarterly revenue growth.

With few big sector-specific catalysts on the horizon, one analyst thinks the direction of semiconductor and other technology stocks will be determined by the Fed’s next move and macro data.

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.