Shares of Nvidia, listed on Wall Street, fell 9.53%, or $279 billion, in Tuesday’s session, amid fears that the US economy is entering a recession.
According to Wall Street data at the end of Tuesday’s session, major companies listed on Wall Street witnessed collective declines, in a major collapse witnessed by the stock market since the stock crisis on August 5.
Nvidia shares fell 9.53% on Tuesday, with its market value settling at $2.65 trillion, $850 billion below the company’s all-time high in July.
Nvidia’s $279 billion plunge is the deepest one-day drop in market value for a U.S. company since Wall Street was founded more than 200 years ago.
The stock’s rapid decline is a key sign that investors are becoming more cautious about emerging artificial intelligence technology, which has fueled much of this year’s stock market rally. It comes after a report that the U.S. Justice Department has sent subpoenas to Nvidia as part of an escalating antitrust probe.
The PHLX chip index fell 7.75%, its biggest one-day drop since 2020, according to Wall Street data.
The latest concerns about AI come after Nvidia on Wednesday delivered a quarterly forecast that failed to meet the high expectations of investors who had driven a stunning surge in its shares.
Also, the United States released disappointing data on manufacturing activity in the country on Tuesday, which fueled fears that the country is entering a recession.
The ISM manufacturing Purchasing Managers’ Index (PMI) rose slightly to 47.2 in August, from a low of 46.8 in November 2023.
However, the figure was below market expectations of 47.5, marking the 21st contraction in US manufacturing activity over the past 22 months (a score below 50 indicates a decline).
Following the sharp decline in Nvidia’s stock, the fortune of the company’s CEO, Jensen Huang, plunged to an all-time low, losing about $10 billion to $94.9 billion on Tuesday, his biggest daily drop since the Bloomberg Billionaires Index began tracking his wealth in 2016.
