The Direxion Daily Semiconductors Bull 3x Shares (SOXL), a leveraged exchange-traded fund tracking semiconductor stocks, soared 5.01% intraday on Tuesday. The significant gain reflects a broad-based rally across the semiconductor sector.

The surge was primarily driven by positive market sentiment following the release of lower-than-expected U.S. inflation data, which boosted technology and semiconductor stocks. Analyst optimism further fueled the rally, with KeyBanc raising price targets for several major chip stocks, citing strong data center demand and tightening memory supply.

Additionally, the ongoing artificial intelligence (AI) boom continues to underpin strong demand for semiconductors, with reports highlighting the deep integration of cloud service providers in the volatile chip market. Discussions about potential supply shortages in the memory chip industry also contributed to the positive sentiment supporting semiconductor equities.