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Nvidia's meteoric rise crashes

by on25 June 2024

Stock market bloodbath

Just days after capturing global adoration, Nvidia, the AI tech chip manufacturer, has suffered a dramatic reversal of fortune. What was once the darling of the world's investors has now become a battlefield of financial carnage.

Last week, Nvidia had overtaken Microsoft in market capitalisation, making it the world's largest and most valuable company. With a staggering market cap of $3.4 trillion), Nvidia outshone its rivals. However, the tides have swiftly shifted.

This morning, less than a week after its ascent, Nvidia's stock plummeted by 6.7 per cent. This marks its third consecutive decline on the stock market and the most significant single-day drop since April. Analysts speculate that Nvidia's temporary fall from grace is dragging down the NASDAQ index.

In a jaw-dropping turn of events, approximately $US430 billion of Nvidia's value evaporated within three days. According to data compiled by Bloomberg, this colossal wipeout is unprecedented in the annals of corporate history.

At Monday's US market close, Nvidia's market cap dwindled to $2.9 trillion, placing it behind Microsoft's $3.3 trillion) and Apple's $3.2 trillion).

Nvidia's shares have surged by more than 190 per cent, with 30 per cent of that growth occurring in the last three months alone.

Nvidia's US CEO and founder, Jensen Huang, seized the moment, cashing in by selling shares worth approximately $95 million between June 13 and June 21.

The sudden crash appears to have been caused by the cocaine nose jobs, who believed that Nvidia's value could not increase much more and that it was time to cash out and make a killing. Nvidia is still a good company and is expected to rise in value again slowly, but it might take longer before it challenges Apple or Microsoft for leadership again.

Last modified on 25 June 2024
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