- The recent volatility of Nvidia Corp.’s stock is reminding some of the early 2000s when the dot-com bubble burst and shares of businesses like Cisco Systems Inc. and Intel Corp. crashed and never recovered entirely. Investors are curious as to whether the company that is creating the chips that are driving the AI revolution will suffer the same fate.
- Last week, the uncontested leader of the AI craze closed at an all-time high and momentarily overtook Apple Inc. (AAPL, +0.31%) and Microsoft Corp. (MSFT, -0.47%) to become the most valuable public business in the world before quickly relinquishing that distinction on Thursday. In the last three trading days, Nvidia’s shares NVDA, -6.68% fell by about 13%, wiping away $430 billion in market value and raising fears that the company’s meteoric rise in share price could be coming to an end.
See Less than a week after reaching a peak, Nvidia’s stock moves into the correction zone.
- Due to the rapid recent decline in Nvidia’s stock, several market experts have drawn analogies between Nvidia’s stock performance and that of Cisco CSCO, -0.02%, and Intel INTC, -1.67% in the early 2000s, the businesses impacted by the dot-com bubble that burst 24 years ago.
- Recently, the stock of Nvidia was trading around 100% above its 200-day moving average. According to Jonathan Krinsky, chief market technician at BTIG, since 1990, the biggest spread that any U.S. business has ever traded over its 200-day moving average while being the largest company was 80%, accomplished by Cisco in March 2000 (see chart below).
Source:
marketwatch
