NVIDIA crashed, is the US stock market over?
NVIDIA plunged 6.7% overnight, dragging down the technology sector, while the energy and banking sectors performed well. Some analysts believe that this pullback represents a "quite healthy" sector rotation
After reaching the top of the US stock market value list last week, NVIDIA has fallen for three consecutive days, dragging down the overall market.
Overnight, NVIDIA, known as the "AI leader", plummeted by 6.7%, marking the largest single-day decline in two months and entering a technical correction phase. Currently, NVIDIA has fallen for three consecutive days, dropping more than 16% from last Thursday's high point, with the company's market value falling below $3 trillion, ranking third in the US stock market.
Affected by this, the S&P 500 index fell for three consecutive days to a one-week low, while the Nasdaq and Nasdaq 100 have been moving away from historical highs for three consecutive days. Looking at different sectors, the energy, financial, and utilities sectors performed well, all rising by about 1%, while the technology sector was the biggest drag, with a decline of over 2%.
The "Big Seven" tech stocks have also retreated from their recent highs, almost giving back all the gains since the release of the CPI data earlier this month.
What is the impact on the US stock market?
Just as it secured the title of "global stock king," NVIDIA faced a massive sell-off, with its market value evaporating by about $430 billion in three days, marking the largest three-day market value drop in history for a single listed company.
An analysis by Wall Street See earlier pointed out that the "Triple Witching Day," frequent executive selling at NVIDIA, and profit-taking by some investors have all severely impacted NVIDIA's stock price performance.
Will NVIDIA's current pullback continue? What is the impact on the US stock market?
Larry Tentarelli, Chief Technical Strategist at Blue Chip Daily Trend Report, believes that NVIDIA's pullback is actually "quite healthy":
"What we've seen last week and now is a healthy rotation. This is actually a very good pause for the tech sector, with the hotspots rotating to some other industries that have been in a downtrend."
Driven by the AI boom, NVIDIA's cumulative gain so far this year is still as high as 145%, leading to a 14% cumulative increase in the S&P and setting 31 new closing highs
Currently, Wall Street is holding its breath for the PCE price index to be released this Friday, which is expected to be another major catalyst for the recent US stock market