Stocks declined on Thursday following Nvidia’s earnings report, which led to a drop in semiconductor and other AI-related stocks. Nvidia shares fell more than 7%, pushing the stock over 15% below its January peak. Other chipmakers like Broadcom and Micron also saw significant declines, with the PHLX Semiconductor Index dropping over 5%. This downturn impacted major stock indexes, with the Nasdaq Composite falling more than 2% and the S&P 500 down 1%. Despite Nvidia surpassing expectations with its fourth-quarter earnings, where data center revenue nearly doubled, the stock fluctuated before settling into a decline. Market participants had anticipated a substantial post-earnings move, with options pricing suggesting an 8% swing. The selloff indicated that while Nvidia’s results were strong, they did not meet investor expectations amid concerns about AI spending and economic conditions. Investors have been selling off high-priced AI stocks recently, a trend that accelerated during Thursday’s selloff. — news from Investopedia
