Apple is already in a correction and Tesla is in a bear market, but the other four stocks are near highs
Nvidia’s stock losses Tuesday put it into correction territory.
Hot chip stocks declined in Tuesday’s session, and Nvidia Corp. shares entered correction territory in the process.
Nvidia’s stock fell 2% in Tuesday trading to end the day at $853.54. Because it finished below $855.02, it entered a correction, which is typically defined by those on Wall Street as a decline of between 10% and 20% from a bull-market high.
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The stock joined Apple Inc.’s in correction territory. The smartphone maker hit that threshold on March 4 with a close below $178.30.
Among the other tech stocks in the group known as the Magnificent Seven, Tesla Inc.’s stock is in a bear market, which is defined as being down more than 20% from its bull-market peak. The other four components — Alphabet Inc., Amazon.com Inc., Meta Platforms Inc. and Microsoft Corp. — all are seeing their stocks near highs. Alphabet shares, for instance, closed up 1.1% to finish at a new all-time high of $156.60.
While the PHLX Semiconductor Index SOX rose nearly 1% in Tuesday’s session, some trendy chip-related names saw declines along with Nvidia’s stock. Shares of Super Micro Computer Inc. slipped 2.6%, and shares of ARM Holdings PLC lost 1.9%.
D.A. Davidson analyst Gil Luria delivered a cautious long-term view on Nvidia shares on Tuesday. The company “should deliver a spectacular 2024 (and perhaps into 2025),” Luria wrote. But “recent trends set up a significant cyclical downturn by 2026,” he continued.
“A combination of shrinking models, more steady growth in demand, maturing hyperscaler investments, and increased reliance by their largest customers on their own chips do not bode well for [Nvidia’s] out years,” he said in a note to clients. Luria has a neutral rating on the shares.
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