Why is the BrainChip share price gaining 5% on Friday?

Person pointing finger on on an increasing graph which represents a rising share price.

Person pointing finger on on an increasing graph which represents a rising share price.

The S&P/ASX 200 Index (ASX: XJO) is giving investors a rather pleasant end to the trading week so far this Friday. At the time of writing, the ASX 200 is up a decent 0.36% at around 6,550 points. But it’s been a far more pleasing day for one of the ASX 200’s newest members – the BrainChip Holdings Ltd (ASX: BRN) share price.

BrainChip shares are finishing their first week on the ASX 200 today after the artificial intelligence company officially joined the index on Monday. And what an end to the week it has been so far. BrainChip shares are presently up a pleasing 4.6% at 91 cents a share.

So why are BrainChip shares rising so enthusiastically today?

Why is the BrainChip share price rocketing almost 5% today?

Well, it’s worth noting that this move comes after a tough few days for the company, share price wise. Although BrainChip is booming today, the company was heavily sold off for most of the week. It reached 88 cents a share yesterday after falling more than 5% since Monday. Even after today’s rebound, BrainChip remains down by more than 21% over the past month alone.

So perhaps investors have just decided that this company got too cheap to ignore yesterday, and are flocking back today. But we also see similar moves across the ASX tech share space today, which could also explain Brainchip’s rise.

As we discussed earlier, ASX tech shares of many stripes are booming today. Take Block Inc (ASX: SQ2). This company’s shares are up more than 10% today. Or Life360 Inc (ASX: 360), up almost 18%. Xero Limited (ASX: XRO) is up almost 5%, while WiseTech Global Ltd (ASX: WTC) has zoomed 6% higher.

So it’s also possible that BrainChip shares have just been caught in this ASX tech share updraft that we are seeing.

Whatever the reason, it sure has been a good day for BrainChip shareholders so far.

At the current BrainChip share price, this ASX tech share has a market capitalisation of $1.56 billion.

The post Why is the BrainChip share price gaining 5% on Friday? appeared first on The Motley Fool Australia.

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Motley Fool contributor Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Block, Inc., Life360, Inc., WiseTech Global, and Xero. The Motley Fool Australia has positions in and has recommended Block, Inc., WiseTech Global, and Xero. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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