The market price of Intel Corporation (INTC), which had lost up to 72% from its peaking value in spring 2021, suddenly spiked by 11% over the past 24 hours, including a 6% jump within the regular Wall St session on February 11 and another 5% in pre-market trading the next day. Intel's "deep" value still exists, even though its core CPUs (central processing units) segment clearly gives way to more advanced GPUs (graphic processor units), being forced to step aside in favour of increasingly sought-after AI (artificial intelligence) chips by NVIDIA and other flagship-level rivals. Intel shareholders were tired of dreaming but the 40-year-old U.S. vice president JD Vance's speech at the AI Action Summit in Paris brought them a glimmer of hope.

JD Vance only shed some light to the stance of the new White House dwelling team on supporting AI manufacturers, which did not give up their efforts on establishing major production processes within the U.S. jurisdiction. He defined an updated American policy on AI as going forward, adding that the Trump administration "will ensure that the most powerful AI systems are built in the U.S. with American-designed and manufactured chips". That's exactly the point which is easy to say, not easy to do. Investors should be aware that the services of programmers and developers, and especially assembling pieces in the Asian region, for example, are much cheaper than in any of the G7 countries. If so, keeping AI regulations light is only a necessary first step, which should include ending the self-killing practice of banning advanced chip exports to China under an invented pretext of some safety measures. JD Vance said the U.S. is going to ''ensure that AI systems developed in America are free from ideological bias'', whatever this could mean, while aiming at other governments for ''tightening the screws'' on U.S. tech firms. Yet, we think that tax benefits may also be an integral part of the plans, since the financial component of such kind of production in the U.S. raises a lot of reasonable doubts right at the moment.

As to Intel's story, it has not been one of success in the past 30 years, as the firm's market cap is still below $100 billion. This is very close, or you may even say on par with old levels of 1996. One can call it fully sustainable, with only acquisition rumours citing a possible Intel's drop into the bucket for larger tech giants like Microsoft, Amazon or Qualcomm partially supporting Intel's share price from further sliding down. However, it was Intel Corporation announcing its plans as early as spring 2024 to invest some $100 billion into U.S.-located factories. The investment would predominantly be accomplished through building "the largest AI chip manufacturing site in the world" in the state of Ohio, according to Intel's CEO Pat Gelsinger, who also shared conceptions of Intel's existing factory modernization in New Mexico, Oregon, and Arizona. Bold plans on U.S. soil, and that was the reason why Wall Street rallied exactly on Intel after JD Vance enthusiastic declarations.

The words of Trump team members could support everything for the first time. Yet, specific financing measures are needed to achieve a more reliable trend in yesterday's underdogs like Intel. Even Tesla stock, led by Trump's main ally Elon Musk, failed to maintain its post-elections hyping highs around $480 per share to move closer to $300 over the next weeks. And Tesla is definitely much more successful as an EV maker compared to Intel as a chip seller. It is one thing if Intel would be confirmed as getting financial injections of tax cuts like in the case of the famous program on building data centers, which was already widely advertised under Trump. In this positive scenario for Intel, it would be back to $50 in no time, compared to just above $22 at the time of this writing. In all other cases, however, unless the Republican White House and Capitol Hill help Intel with the well-done merger deal or/and proper tax cuts, protective import tariffs for foreign rivals are unlikely to be enough. Then any words will be cheap, and Intel shares will slide into another pothole in the road once again.