Nvidia stock tanks 4% amid rough week for chip stocks

Published On Sep 6, 2024, 4:34 PM

Nvidia's stock dropped 4% following a difficult week for semiconductor companies, amid overall market declines spurred by a better-than-expected jobs report, which led analysts to anticipate a smaller interest rate cut by the Federal Reserve. Concerns over capital spending in tech infrastructure and doubts about the sustainability of AI-related growth contributed to this downturn. Nvidia's stock has decreased approximately 13% over the last four trading sessions, while other companies in the sector, such as Broadcom and ASML, also experienced notable declines.

Stock Forecasts

The overall semiconductor sector is facing headwinds due to investor concerns about growth sustainability and potential Fed actions. Nvidia's performance has been particularly affected by these external market factors, coupled with its recent earnings report not meeting high expectations.

Broadcom's disappointing sales forecast despite strong demand for its AI chips reflects broader market uncertainties, which could continue to pressure investor sentiment in the semiconductor sector.

ASML's shares fell in response to increased export controls, which could hamper its growth prospects in advanced chip manufacturing. This regulatory risk may continue to negatively impact investor sentiment.

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