After a terrible 2022, the Nasdaq Composite delivered impressive returns of 29% so far in 2023, driven by a solid surge in technology stocks.

One of the main reasons why technology stocks have been in fine form this year is because of the artificial intelligence (AI) craze. The massive popularity of generative AI, triggered by the launch of ChatGPT late last year, shifted the race among tech companies to develop AI applications into high gear. That's not surprising, as the generative AI market is projected to grow at a compound annual rate of 42% over the next decade, generating $1.3 trillion in annual revenue in 2032.

Semiconductor sector bellwether Nvidia (NASDAQ: NVDA) has been a big early winner in this AI race. Shares of the chipmaker are up 215% in 2023 as demand for its AI chips has boomed. Nvidia's growth has simply taken off as customers have been queueing up for its top-of-the-line data center graphics processing units (GPUs) so that they can train large language models (LLMs) and offer generative AI-powered services to their customers.

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Source Fool.com