Nvidia shares are down 9.5% since yesterday amid growing concern among investors that the AI market could be experiencing a slowdown.
Share prices now stand at $108, down from a high of more than $135 in June. This translates to a market cap of $2.02 trillion, after Nvidia hit an all-time high of more than $3 trillion earlier this summer.
Moreover, the FTSE 100 index dropped 0.76%, with FTSE Russell representative Julia Lee noting (via the BBC): “Growth concerns are dominating market moves.”
Is the AI market slowing down?
The sentiments have been mirrored across the board, with the S&P 500 index dropping 2% and Nasdaq falling by 3%.
While tech giants like Alphabet, Apple and Microsoft have seen shares drop, Nvidia saw the biggest hit, with $279 billion wiped off its market cap in the space of a day. While its valuation may stand at nine times that of the pre-ChatGPT AI boom, it has already lost one-third in the months following it becoming the world’s most valuable company, rated at more than $3 trillion.
Lee also noted a similar decline in Asian markets, including Japan’s Nikkei 225, South Korea’s Kospi and Hong Kong’s Hang Seng: “Concerns around global growth look to be hitting exporting countries in the region particularly hard.”
Understanding why Nvidia has been hit so hard is a two-pronged tale – the company already indicated that a natural deceleration to growth would be inevitable, but emerging antitrust investigations into the company both in the US and Europe have likely proven a cause for concern among investors.
Other factors, such as US jobs figures set to be announced later this week and an interest rate decision by the US Federal Reserve due next week, are also at play in dwindling shares in the sector.
More from TechRadar Pro
These are the best AI tools and best AI writersWe’ve rounded up a list of the best processorsNvidia was officially more valuable than Apple — for a couple of hours, at least