Nvidia’s stock experienced an unprecedented $277 billion intraday market cap swing on Thursday, closing 3.5% lower at $131 per share. While starting Thursday at a strong stock price of $139.89, the highest ever they have reached, it was short-lived.
This drop reduced Nvidia’s market value to $3.2 trillion, placing it behind Microsoft’s $3.31 trillion, making it the most valuable company again. Initially, Nvidia’s shares rose by 4% before reversing course, marking the largest one-day loss in Wall Street history.
Source: Reuters
The sell-off, driven by profit-taking after a significant rally, saw Nvidia’s stock fall as much as 8% from its morning peak. Despite this, Nvidia has remained at 40% over the last month and has surged by 170% year-to-date.
The dramatic reversal came after Nvidia briefly became the largest U.S. company by market capitalization. The $277 billion intraday swing surpassed previous records, highlighting the stock’s volatility and significant market impact.
Broad Market Sensitivity Nvidia’s decline erased $277 billion in market value, impacting the broader market by turning the S&P 500’s gains into losses. The decline appeared to be driven by profit-taking rather than any specific catalyst.
– TL;DR: Nvidia stock is expected to increase.- XLK, a technology sector ETF, will shift its weighting to increase Nvidia’s position to over 20% and decrease Apple’s position to 5%
– Apple and Nvidia will switch positions in XLK, with Nvidia becoming the second-largest holding— FluidBot (@FluidBotStocks) June 21, 2024
Despite the selloff, Nvidia remains dominant in the Artificial Intelligence chip market, controlling 80% of the high-end sector. The company’s projected 233% revenue growth for the current quarter fuels investor optimism. In contrast, the S&P 500 index took a hit altogether.
However, some analysts express concerns over Nvidia’s sustainability amidst U.S. export restrictions on chip sales to China. These challenges and rapid stock appreciation raise questions about future market stability.
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The market’s sensitivity to Nvidia’s movements highlights the significant influence of leading tech companies on broader market dynamics.
Other Nvidia News:
Nvidia’s rapid AI-driven growth has cemented its position as a global tech leader valued at over $3 trillion. The company’s innovative solutions set new industry benchmarks.
20-06-24 – AI Boom Propels Nvidia to Unprecedented Heights as the World’s Leading Tech Giant
06-06-24 – US Regulators Launch Antitrust Probes Into Tech Titans Microsoft, OpenAI, and Nvidia
07-05-24 – Nvidia to Acquire Run:AI for $700 Million to Boost AI Efficiency
07-05-24 – Nvidia CEO Jensen Huang Hand-Delivers First DGX H200 to OpenAI
07-05-24 – Vietnam’s Tech Giant FPT Invest $200 Million to Build AI Factory With Nvidia
Despite its success, Nvidia faces regulatory scrutiny and is expanding through strategic acquisitions, like Run AI, and partnerships, such as the $200 million AI factory with Vietnam’s FPT.
Nvidia’s situation underscores the need for strategies to manage volatility, ensuring market stability and investor confidence.
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