Is NVDA Stock Downtrending?
NVIDIA Corporation (NASDAQ:NVDA) fell by about six percent as of this article’s writing on Thursday, which is a departure from what has been a great year for the computer chipmaker.
As reported earlier, both Advanced Micro Devices, Inc. (NASDAQ:AMD) and NVIDIA have shown impressive gains over the year. NVIDIA stock is up 164% since the beginning of 2016. For AMD, the growth is even larger at 192%. This raises the question as to why were both of these otherwise impressive 2016 stocks falling on Thursday?
The downtrend that many tech stocks were facing on Thursday—especially NVIDIA stock and AMD stock—might be a response of the market to the NASDAQ 100’s relative perceived weakness.
While the Dow Jones Industrial Average (DJIA) and the S&P 500 Index both had very strong Novembers, the comparatively muted numbers of the NASDAQ 100 might be signaling to investors that a shift is taking place.
Remember, in this post-Donald Trump world, there’s been much discussion as to whether tech stocks will be hurt by a new White House administration. The early results were inconclusive but, as time goes on, we’ll be able to better gauge what a Trump presidency will mean for tech stocks.
But, back to the present. With some investors looking at other sectors as being perhaps more lucrative than the currently dominant tech industry, this could help explain how otherwise very well-performing stocks are seeing a drop in today’s market. And there’s been a lot of good news recently for NVIDIA.
For instance, the company recently announced a collaboration with Microsoft Corporation (NASDAQ:MSFT) to accelerate artificial intelligence (AI) in the enterprise sector, which is a big win for the chipmaker. (Source: “Two Technology Stocks Are Hot: NVIDIA Corporation (NVDA), Symantec Corporation (SYMC),” The Independent Republic, December 1, 2016.)
Keep an eye on the chipmaker industry to see if in the future it will return to form, or if this is indicative of a potential reversal of fortunes.