On January 27, 2025, shares of chipmaker Nvidia experienced a significant drop, marking its worst day since March 2020. The decline was driven by a global tech stock sell-off, fueled by concerns over the united states‘ position in the artificial intelligence sector following advancements by a Chinese startup.
- Nvidia shares plunged 18% on Monday.
- Global tech stock sell-off fears increased.
- Nvidia's market value dropped below $3 trillion.
- Losses accounted for $600 billion in value.
- Nvidia surpassed Apple, then lost its title.
- S&P Technology sector fell into the red.
Nvidia’s stock plummeted amid fears regarding America‘s competitiveness in the AI industry, particularly after a Chinese startup announced significant advancements. This sell-off resulted in Nvidia’s market value dropping to approximately $2.9 trillion, down from a peak of $3.7 trillion. Despite this setback, Nvidia shares have risen over 480% in the past two years.
The loss accounted for nearly $600 billion in market value, making it the largest single-day drop in U.S. history, according to Bloomberg. This figure is nearly double the previous record, which occurred in September 2024 when Nvidia lost $279 billion in value. For context, the market value lost on Monday exceeded the total market value of major companies like Exxon Mobil and Bank of America.
Nvidia’s decline also impacted the broader market, contributing to the Dow Jones Industrial Average’s volatility. The index closed higher but started the day in the red. Nvidia, which joined the Dow in November 2024, replaced Intel and has been a significant player in the tech sector. The Nasdaq Composite index, which tracks tech stocks more closely, fell around 3% as a result of the sell-off.
As the global tech stock market faces challenges, the S&P Technology sector has dipped into negative territory for the year, becoming the only sector to do so. This reflects the ongoing uncertainty and competitive pressures within the industry.
The substantial loss in Nvidia’s market value highlights the volatility in the tech sector, particularly regarding AI advancements and international competition. As the market adjusts, Nvidia’s future performance will be closely monitored by investors and analysts alike.
