Nvidia (NVDA), the first company to break the $5 trillion mark in market value, has suffered a significant drop of $500 billion this week. Investors are reacting strongly to concerns about the AI market and geopolitical uncertainty.
AI hype under pressure: Nvidia crashes at thirteen percent
On Monday, Nvidia was still at $4.94 trillion, but it has now fallen by more than ten percent. On Friday, the stock closed at $188, good for a loss of about $500 billion in just five days.
Investors are concerned about signs that the AI market is overheating. Poor US labor data also dampened sentiment. But the biggest blow came from investor Michael Burry, known for ‘The Big Short’, who reportedly took a $1 trillion short position against Nvidia, among others.
Nvidia stops deliveries to China – markets react strongly
On Friday, CEO Jensen Huang stated that Nvidia has no plans to sell the new Blackwell chips in China for the time being. “We are not in active discussions with China. It is up to them when they want to receive our products again,” Huang said.
That statement abruptly put an end to speculation that talks between Donald Trump and Xi Jinping might lead to new trade agreements. The uncertainty surrounding China puts extra pressure on technology stocks.
Other chip companies are falling along with it
Not only Nvidia, but also sector peers were hit hard. AMD fell by almost five percent, while Broadcom lost 3.5 percent. Investors seem less enthusiastic about AI-based growth stories for the time being.
Source: https://newsbit.nl/paniek-op-de-beurs-nvidia-verliest-500-miljard-dollar-in-een-week/
