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Nvidia stock tumbles forcing it to give up top slot crown

A sign for a Nvidia building is shown in Santa Clara, Calif., May 31, 2023.
A sign for a Nvidia building is shown in Santa Clara, Calif., May 31, 2023. Copyright Jeff Chiu/2023/AP.
Copyright Jeff Chiu/2023/AP.
By Eleanor Butler
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The "AI darling" has recorded losses for three trading days in a row, waving goodbye to more than $500 billion in market value since last week's peak.


American chipmaker Nvidia saw its share price drop to around $118 (€110) on Monday.

That was a daily drop of 6.7% and a 16% decline compared with last Thursday's peak, when the stock hit an all-time high of $140 (€131).

The selloff erased around $550 billion (€513 billion) from Nvidia's valuation, a rapid fall from grace after the firm was last week crowned the world's most valuable publicly listed firm.

With a market cap of $2.91 trillion (€2.71 trillion), Nvidia now sits in third place, behind Microsoft and Apple.

Public frenzy around artificial intelligence has sent Nvidia's stock price soaring in recent years, up 140% in 2024 so far.

This is thanks to the fact that Nvidia's chips, also known as graphic processing units (GPUs), can quickly organise data to train AI models and generate sophisticated images.

As Nvidia's share price rose, some investors have been eager to cash in on their gains through selling stock.

It was revealed on Friday that Nvidia's CEO and co-founder, Jensen Huang, sold almost $95 million (€89 million) worth of his shares in the firm earlier last week.

Although some analysts are concerned that Nvidia’s volatility could spark a wider market downturn, most are still projecting a strong future outlook for the company.

"Last night's sell-off in certain US tech stocks doesn't appear to have had any lasting damage," said Russ Mould, investment director at AJ Bell.

"Admittedly, a near-7% decline in Nvidia might have sounded the alarm bells that we're seeing a shift in the market. It's important to remember that stocks don't always travel in a straight line."

"When everyone was piling into Nvidia, it created a sense of FOMO – fear of missing out – so others followed suit and bid up the shares even further. The same works in reverse, where a bout of selling can be exacerbated by others following the crowd and panicking."

Nvidia will later this year start shipping its new and improved chip, Blackwell, which succeeds its Hopper technology.

Some analysts believe this could trigger another boom in the value of the company's stock.

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