Broadcom's rally propels Nvidia further into correction territory.

• On Tuesday, Broadcom's rapid ascent caused Nvidia's premarket shares to decline.
• While Broadcom's shares have surged 40% in the past five days, Nvidia's shares have declined 5%.
• Although Nvidia's stock has decreased recently, it has increased by over 160% for the year. Similarly, Broadcom has experienced a rise of more than 120% in the same time frame.

On Tuesday, shares rose in premarket trading, as the stock continued its rapid climb upward.

Nvidia's stock price dropped by 1.8% during premarket trading at 10:47 a.m. in London. On Monday, the company entered correction territory, which is defined as a 10% or greater decline from an all-time high close.

Nvidia hit its closing high of $148.88 last month.

Broadcom shares were up 1.9% at 10:50 a.m. London time in premarket trade, while Nvidia shares had fallen 5% over the past five days.

Recent earnings and revenue forecasts have boosted optimism about Broadcom, leading Wall Street brokers, including Goldman Sachs, to increase their stock price targets.

Over the past year, Broadcom's stock has increased by more than 120%, while Nvidia's stock has experienced a growth of over 160%.

Nvidia's GPUs have emerged as the preferred silicon for training large models, including those created by OpenAI.

Broadcom specializes in creating custom AI chips for hyperscalers, which are major cloud computing companies.

"Broadcom CEO Hock Tan stated during the company's earnings call that there is an opportunity for growth in AI over the next three years. He also mentioned that large-scale hyperscalers have started their journey to create their own custom AI accelerators."