Tesla Inc. CEO Elon Musk ridiculed the sharp 10% decline in Nvidia Corp.'s NVDA stock and its subsequent $211 billion market capitalization loss on Friday.
What Happened: Musk took to X, formerly Twitter, on Friday to mock the substantial decline in Nvidia's market capitalization. He referred to the 10% decline as “rookie numbers."
On Friday, Nvidia’s stock took a significant hit, resulting in a $211 billion loss in market capitalization. This was the second-largest single-day loss in the history of the U.S. stock market.
See Also: Tesla’s Autonomous Driving Efforts Win Praise From Goldman Sachs
Overall, the Magnificent 7 group of stocks, which includes Apple Inc., Alphabet Inc.'s Google, Microsoft Corp., Meta Platforms Inc., Amazon.com Inc., Tesla and Nvidia together witnessed a record $950 billion loss of market capitalization in the last week, according to MarketWatch.
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Why It Matters: The decline in Nvidia’s stock value has had a significant impact on the market.
The tech-heavy Nasdaq 100 index experienced its worst day since late 2023, and the worst week since late 2022, with a 2.1% drop on Friday. This marked the fourth consecutive week of declines, a negative streak not seen since May 2022.
On a weekly basis, the Nasdaq 100, which is closely tracked by the Invesco QQQ Trust QQQ, tumbled 5.3%, marking its worst performance since October 2022. The downturn on Friday further exacerbated the already pessimistic sentiment surrounding U.S. tech stocks.
Nvidia’s stock decline was attributed to a series of events, including worse-than-expected earnings from ASML Holdings N.V. ASML and a reduced outlook for the chip market by Taiwan Semiconductor Manufacturing Company Ltd. TSM.
Despite the stock decline, TSM’s revenue surged 16.5% to $18.87 billion, surpassing the Street consensus estimate of $18.40 billion. This was attributed to robust demand from artificial intelligence firms.
Other companies in the semiconductor sector, such as Super Micro Computer, Inc. SMCI, also experienced stock declines on Friday, further adding to the overall negative sentiment in the market.
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