Nvidia Stock: Roller Coaster Week After Earnings Report

Nvidia experienced significant market volatility following its latest quarterly results. Initially, investors responded cautiously to the earnings announcement, with shares making modest after-hours gains on Wednesday. However, this neutral reception quickly transformed into a substantial correction as new US tariff threats on Chinese imports and disappointing economic data triggered a sell-off across the technology sector. The chip manufacturer was particularly affected as investors began taking profits, reversing months of AI-fueled gains. The downturn didn't spare related companies like Super Micro Computer, Palantir, and AMD, which were also dragged lower. By Thursday, Nvidia shares had plummeted 8.48 percent to $120.15, with investors expressing disappointment over the margin outlook despite impressive profit figures.

Market Recovery Emerges

Friday brought welcome relief as Nvidia shares stabilized with a modest 1.1 percent increase, contributing to a broader tech sector recovery. The Nasdaq index finished strong with a 1.62 percent gain to 20,884.41 points, halting the sharp decline of previous days. This partial rebound occurred amid a generally improving market sentiment, though the month remained challenging for technology stocks overall. The shift in investor behavior was further evidenced by global hedge funds, which sold more shares than they purchased during the week-their largest sell-off in a year. Notably, engagement with the "Magnificent Seven" tech stocks, including Nvidia, dropped to its lowest level since April 2023, potentially indicating that hedge fund risk reduction might be nearing its conclusion.