Nvidia’s decline and a massive debut from China’s CXMT deepen concerns over chip sector competition and funding shifts.
Shares of Nvidia fell sharply overnight, contributing to a broader selloff in chip stocks amid reports of circular financing with OpenAI and rising competition. The decline occurred despite a drop in oil prices below $90 per barrel, as geopolitical tensions eased temporarily.
The rout followed a blowout initial public offering of China’s CXMT, which surged nearly 470% on its first trading day. Analysts cited the IPO as a potential catalyst for reallocating investment funds away from established players. Additionally, reports of Chinese firms replicating ASML’s technology weighed on the European chip equipment maker’s shares.
Market sentiment remained fragile ahead of key earnings reports from major tech firms in the U.S. and Asia. The chip sector’s volatility underscores growing investor unease over valuation pressures and shifting industry dynamics.