Nvidia stock on track to end week down more than 10% amid investor concerns over AI valuations
Nvidia (NVDA) shares sparked a sell-off in tech on Friday, falling as much as 4% as AI valuations remain top of mind for investors.
Concerns about an AI-fueled stock market bubble led to volatile trading in shares of the “Magnificent Seven” company last week. Circular deals among key players in the AI boom have led to comparisons with the dot-com boom and bust.
The decline in Nvidia’s shares capped a difficult week for the chip maker; Shares are on track to end the five-day period down nearly 10% at midday.
Read more about Nvidia’s stock movements and today’s market action
The stock fell along with other tech names on Thursday after a Trump official said the government had no intention of supporting the artificial intelligence industry, citing comments from OpenAI (OPAI.PVT) CFO Sarah Friar.
White House AI and crypto czar David Sacks wrote about X: “There will be no federal bailout for AI. The US has at least 5 major pioneering model companies. If one fails, others will take its place.”
Sacks continued: “I don’t think anyone actually wants a bailout. (That would be ridiculous.) But company executives can clarify their own comments.”
The post was in response to comments Friar made about chip financing at a Wall Street Journal conference on Wednesday.
Friar said ChatGPT’s maker might seek a government “guarantee” that would make it easier to finance AI chips for data centers. OpenAI CEO Sam Altman later dismissed the idea that the company was seeking government guarantees to protect itself against failure.
Chipmakers were already in the red on Thursday after Qualcomm (QCOM) reported quarterly results on Wednesday afternoon. Results were strong, but investors were nervous due to overvaluation concerns in the sector.
Nvidia CEO Jensen Huang at the beginning of the week China will ‘win’ AI race with US, tells Financial Times.
Huang later wrote that China It is “nanoseconds” behind the USA in artificial intelligence.
“It is vital that America wins by competing and winning over developers around the world,” he wrote.
Ines Ferre is Yahoo Finance’s senior business reporter. Follow him on X @ines_ferre.
