Nvidia Falls for 7th Straight Session for First Time in 4 Years Amid AI Stock Exits Ahead of Earnings

Bloomberg reported that Nvidia's stock fell for the seventh consecutive session on Wall Street on the 24th (local time), fueling caution across artificial intelligence (AI) investments ahead of its earnings release.

Nvidia's stock closed down 2.9% from the previous session at $208.48.

It has dropped for seven straight trading days starting from the 14th.

The decline during this period reaches 7.5%.

This marks Nvidia's first seven-day losing streak in about four years, since September 2022.

A combination of negative factors is weighing on the stock's weakness.

Reports emerged that Nvidia notified clients on the 22nd that it would raise the prices of AI servers slated for release next year by up to 15%, citing rising memory costs.

Additionally, criticism over its "circular financing" approach of investing equity in major clients such as OpenAI and Anthropic, along with growing political backlash surrounding the construction of AI data centers, is reportedly acting as a burden on the stock price.

The flight from AI-related stocks surrounding Nvidia has continued even as some tech stocks recently rebounded.

On this day, the Philadelphia Semiconductor Index dropped 2.7%.

Semiconductor stocks fell across the board, including AMD (-3.5%), Broadcom (-2.6%), Micron (-5.8%), and SanDisk (-6.5%).

Neo-cloud companies CoreWeave (-1.8%) and Nebius Group (-3.8%) also could not avoid the downward trend.

Bloomberg reported that the 40-day correlation coefficient between Goldman Sachs' AI stock basket and the S&P 500 index excluding AI has dropped to around -0.6, showing a deep negative correlation for the first time in history.

It explained that this is a signal that funds leaving AI stocks are not exiting the stock market entirely, but rather moving to other stocks.

However, Bloomberg diagnosed that the AI narrative itself has not broken.

AI infrastructure-related companies still account for about half of the S&P 500's earnings growth, and the median earnings growth rate for all companies last quarter reached 14%, indicating that the growth base is broadening.

Nvidia's earnings release scheduled for the 26th is considered a touchstone to gauge the direction of AI-related stocks overall.

Bloomberg evaluated Nvidia's earnings release, as the world's largest company by market capitalization, as "the event closest to a quarterly national referendum on AI-related stocks."
 

(Photo: AP, Yonhap News)
※ Please note: This article was translated by AI and may contain errors.