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Nvidia CEO Jensen Huang.
Nvidia’s stock is off to a positive start after a wild Monday.
Shares of the chipmaking giant were recently up about 2%, easily outpacing the slight rise in the S&P 500. The first hours of Tuesday’s session followed a start to the week that marked Nvidia’s (NVDA) worst day in years, as a roughly 17% drop led to a loss of nearly $600 billion in market value.
Some of the questions that led investors to drop Nvidia and, broadly, back away from the AI trade remain. A reassessment of the trajectory of the artificial intelligence business, triggered in part by a jump in popularity of a Chinese app called DeepSeek, prompted worry about the lifespan of the multibillion-dollar spending trends that have helped power a range of companies’ shares, from chip makers to energy companies, higher in recent months.
On Wall Street yesterday, many analysts and others saw Monday’s pullback as an opportunity to buy the dip.
“We don’t expect any near-term disruption for our top AI semiconductor names,” Oppenheimer analysts wrote late yesterday, citing Nvidia, Broadcom (AVGO), Marvell Technology (MRVL) and Monolithic Power Systems (MPWR). “We expect all four to report upside results and outlook in the coming weeks.”
Still, the road back to Friday’s closing prices is long for many stocks hit that were hard yesterday. Broadcom, another big loser yesterday, was recently down less than 1%.
“Investors may want to consider trimming their tech exposure, given the still-lofty valuations and potential uncertainties ahead,” said ProShares Global Investment Strategist Simeon Hyman.
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