What Happened?
Shares of leading designer of graphics chips Nvidia (NASDAQ:NVDA) fell 5.4% in the morning session after markets tumbled, extending the weakness from the previous week as concerns over the ongoing trade war continued to spread. On Sunday, March 9, 2025, President Trump fielded questions regarding recession worries on FOX News, calling the market struggle "a period of transition," but that didn't do much to calm investors. The sell-off was particularly pronounced in the tech sector, with the Nasdaq falling 3.5% into correction territory, while the S&P 500 also posted a 2.7% decline.
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What The Market Is Telling Us
Nvidia’s shares are very volatile and have had 28 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 7 days ago when the stock dropped 7.9% as market volatility continued, with the stock seemingly affected by the broader downturn as the Nasdaq declined 1.3% in another negative session. Tepid economic manufacturing and construction data sparked another wall of worry about the US economy.
Additionally, investors might have been concerned about the company's business in China, which hadbeen tangled up in the trade war drama. Notably, the Wall Street Journal reported that some Chinese buyers were finding ways around export restrictions to get their hands on Nvidia chips. That kind of news could get regulators thinking about tighter measures, which could further limit Nvidia's business in China.
Nvidia is down 23% since the beginning of the year, and at $106.43 per share, it is trading 28.8% below its 52-week high of $149.43 from January 2025. Investors who bought $1,000 worth of Nvidia’s shares 5 years ago would now be looking at an investment worth $16,311.
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