Nvidia’s shares remained under selling pressure on November 10, fell 5.5 percent and extended the over 4 percent decline in the previous session. Experts believe the weakness is on back of the probe by the company’s independent directors on CEO Jensen Huang and his affair with an alleged Chinese spy. However analysts believe questions on the progress of Nvidia-linked data-centre projects in Ohio and the pace and scale of AI-related investments also remained a concern.
US markets ended lower for the second straight session on Tuesday as the Nvidia-led sell-off in technology stocks and concerns on US inflation and the Federal Reserve’s interest rate outlook all remained. The Dow Jones Industrial Average declined 0.3 percent, the S&P 500 declined 0.3% and NASDAQ 0.7 percent at close. However Nvidia shares fell 5.5 percent at close and were the biggest drag on the S&P 500. The stock has shed over 470 billion in market value in just two trading sessions.
Nvidia is listed on the NASDAQ stock market, it is also a constituent of major US stock indices including the S&P 500 and Nasdaq-100. Therefore the significant volatility in the stock can influence broader US technlogy stocks and in turn the benchmark indices. Investors tracking the global AI trade believe Nvidia is significant as it is also a major global supplier of GPUs and AI computing infrastructure.
Experts believe the long-term picture for the company and AI sector remains critical. “We can always ascribe a reason as to why things are more volatile. And they have been more volatile the last few weeks for sure, since October, let’s call it,” Jason Ware, Chief Investment Officer at Albion Financial Group told Reuters. “But at the end of the day, the path for stocks over the coming weeks and months is going to be really a story of earnings,” he said.
Bureau Report
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