However, investors soon grew more nervous as the company\u2019s \u201cconference call offered limited detail on the revenue outlook\u201d, said Jim Reid, global head of macro research at Deutsche Bank, and the share price dropped sharply once trading began in New York.<\/p>\n
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Mike Zigmont, co-head of trading at Visdom Investment Group, said the market seemed to be realising that \u201cmaybe the super lucrative appreciation phase of this AI investment story is now over\u2009.\u2009.\u2009.\u2009there won\u2019t be the eye-popping returns of the past couple of years, so I think you\u2019ve got people bailing out.\u201d<\/p>\n
Stocks<\/a> have suffered a series of sell-offs in recent weeks as concerns over mega caps\u2019 high spending on the AI build-out collided with fears that the technology could disrupt entire sectors, including software, wealth management and freight and logistics.<\/p>\n \u201cThere is a lot of confusion right now,\u201d said Mika Kastenholz, global head of investment solutions at LGT Private Banking. A single catalyst such as Nvidia\u2019s earnings was not ultimately enough to overturn the \u201cmultiple pockets and sources of uncertainty\u201d \u2014 stemming from tech spending, AI disruption fears and broader geopolitical upheaval \u2014 affecting US stocks.<\/p>\n The Nasdaq Composite\u2019s recent record high was at the end of October, but subsequently rallies have been curbed as concerns about vast capex spending plans gripped investors. <\/p>\n Dan Hanbury, portfolio manager at asset manager NinetyOne, said: \u201cWhat is weighing heavy on investors\u2019 minds is how Nvidia can maintain its phenomenal growth rate now its core customers \u2014 the hyperscalers \u2014 are mostly depleting their cash flows [by] spending on AI-related capex.\u201d<\/p>\n Other chipmakers also dropped alongside Nvidia. Broadcom was down 6.7 per cent in afternoon trading and Amsterdam-listed chip giant ASML closed 4.3 per cent lower. <\/p>\n Shares in groups that have been benefiting from the build-out in AI infrastructure also fell. Lam Research and Applied Materials were each down more than 5 per cent, while server provider Super Micro Computer dropped more than 6 per cent. Memory groups Western Digital and Seagate Technology were down 5.7 per cent and 4.9 per cent, respectively.<\/p>\n Recommended<\/p>\n
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