MediaTek shares jumped to the daily limit after Nvidia's big investment and a rare nod from Broadcom's CEO — good news for MediaTek shareholders, and a warning sign for Broadcom's grip on the AI chip market.

• Nvidia is buying $3.5 billion of MediaTek convertible bonds, giving the Taiwanese chipmaker a war chest for custom AI chips.
• MediaTek stock hit the daily limit up on heavy trading, with volume beating the whole previous session by late morning.
• The shares now trade above the conversion price on those bonds, so the deal is already in the money.
• MediaTek won a big Google TPU order, taking work that used to go to Broadcom.
• Broadcom CEO Hock Tan named MediaTek as a competitor for the first time, after mocking it as an "ankle-biter" back in March.

Outlook: Broadcom still leads on production timing and volume, but MediaTek is now a real second source for Google and the stock has momentum behind it.