Nvidia (NVDA) stock fell early Monday morning after the company suffered its worst one-day loss in 10 months. Last Friday's selloff wiped $250 billion from stock prices and sent fear throughout the market. The BTIG memo argues that AI trade integration is premature.
Yahoo Finance anchors Brad Smith and Seana Smith break down the latest developments in Nvidia and discuss a potential stock split.
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Editor's note: This article was written by Nicholas Jacobino
video transcript
Sheena Smith: Okay, let's take a look at another Mag Seven name. That is NVIDIA. Stock prices fell further in pre-market. You can see that it has decreased by only about 6/10 percent. The few hours here were tough. Prices were rising this morning.
Now, the chipmaker posted its biggest one-day loss in nearly 10 months on Friday. And that was enough to surprise the broader market. At the close of last week's trading, we could see that the S&P and, of course, the Nasdaq were under pressure.
And to put this into perspective, the drop we saw briefly on Friday, when stocks were only down about 6% in intraday trading, wiped $250 billion from stocks in just about three hours. This means that the downside is actually taken into account for investors.
BTIG exited on the note that consolidation in the AI industry is long overdue. A key reversal day on Friday could hint at further easing that may be ahead.
Brad Smith: Yeah. He talked a little bit here earlier this year about how he sees his position within NVIDIA Trading, and in a conversation with Brian Belski, he talked about some of our recent history. I remembered.
And that's probably some of the expected behavior at this point. Over the past two trading sessions, NVIDIA is currently at all-time highs. It's a bit of profit taking, so I remove the chips from the table. We'll probably see some rotation into financials, health care, other popular sectors like Brian was talking about, and other strategists will come before us and make their case.
But now the big question is whether NVIDIA even sees an opportunity for a stock split in the near future. What does that do for retail investors? Will it become more attractive than piling further into the NVIDIA trade despite this huge rally we're seeing at the moment? Therefore, the stock price as an entry point. From a perspective, it becomes more affordable. But still, I think this is one area where we could potentially hear a little more about it if it hits $1,000.
Sheena Smith: Yeah. We've certainly seen the discussion start to really escalate here, at least in the last week, as to what that would entail and the likelihood of that actually happening.
