Goldman Sachs: NVIDIA has entered a bear market, falling nearly 10% on Tuesday due to multiple factors
Goldman Sachs report states that NVIDIA's stock price has fallen 23% from its high on June 20, entering a bear market. On Tuesday, NVIDIA's stock price dropped nearly 10%, with a market value evaporating by $279 billion, marking the largest single-day market value loss in U.S. stocks. The reasons for the decline include performance guidance below expectations, seasonal factors, OpenAI developing new AI chips, and the Department of Justice's antitrust investigation. This decline also dragged down the semiconductor sector, with the Philadelphia Semiconductor Index falling by nearly 7.8%. Goldman Sachs holds a negative attitude towards the semiconductor industry
According to the financial news app Zhitong Finance, NVIDIA (NVDA.US) saw its stock price drop nearly 10% on Tuesday, causing a market capitalization loss of $279 billion, marking the largest single-day market value loss in the history of U.S. stocks. Goldman Sachs trading department stated in a research report that NVIDIA's stock price has dropped 23% from its intraday high on June 20, falling below the 50-day and 100-day moving averages, indicating that the stock is currently in a bear market.
Goldman Sachs trading department mentioned several reasons for NVIDIA's nearly 10% drop on Tuesday, including:
- Investors returning to the market after the U.S. Labor Day holiday, with the remaining performance-related investment impact—second and third quarter earnings per share (EPS) guidance exceeding expectations by a smaller margin, with less surprise than in previous quarters, and gross margins normalizing;
- Seasonal negative factors—since 2020, semiconductor stocks have fallen every September for four consecutive years, with an average monthly decline of 4.6%;
- Reports of OpenAI developing new self-developed AI chips;
- Traders and portfolio managers adjusting holdings during busy industry data periods, such as Broadcom (AVGO.US) announcing earnings on Thursday;
- The U.S. Department of Justice escalating its antitrust investigation against NVIDIA, which is not conducive to market sentiment.
NVIDIA's sharp decline on Tuesday also dragged down the performance of semiconductor stocks. The Philadelphia Semiconductor Index fell nearly 7.8%, marking the largest decline since "Black Monday" on August 5 and the second largest decline this year.
Goldman Sachs technology trader Peter Bartlett stated that the semiconductor industry's sharp decline is "the most frequently asked question (by clients) so far." He admitted that unfortunately, there is currently no satisfactory explanation for why the start of September has been so poor.
Furthermore, Peter Bartlett pointed out that although the start of September has been bad, client feedback does not indicate a high level of "pain" as their holding period for semiconductor stocks has significantly decreased, which is the case for most investor types, especially hedge funds. Goldman Sachs' top TMT expert Peter Callahan noted on Monday that compared to the previous two to three months, the controversy surrounding AI themes has significantly increased