Nvidia (NVDA) stock tanked on Monday, falling greater than 17% and losing nearly $600 billion off its market cap as investors digested the growing popularity of a latest cost-effective artificial intelligence model from the Chinese startup DeepSeek.
But retail investors bought the dip. Data from VandaTrack shows retail investors bought greater than $562 million of the name on Monday, the biggest single day inflow into the stock in VandaTrack’s data. On Tuesday, because the stock rebounded and rose roughly 9%, there was once more a big swath of retail buying totaling nearly $360 million. Across the 2 days of chaotic market motion, retail investors sent greater than $920 million into shares of Nvidia.
Wall street strategists largely agreed with retail investors’ bullish outlook on the name.
“We expect this might be going to find yourself a ‘buy the dip’ Nvidia moment,” Fundstrat head of Research Tom Lee said in a video to clients on Monday night.
Bank of America research analyst Vivek Arya provided similar sentiment in a note to clients on Wednesday, saying the recent drawdown in Nvidia, Broadcom (AVGO) and Marvell (MRVL) provided an “enhanced [buying] opportunity.
The team behind DeepSeek, the synthetic intelligence model maker, claimed that its latest AI model uses cheaper chips and fewer data. Investors are concerned this might hurt future AI chip sales for a corporation like Nvidia in addition to bring into query the dominance of US hyperscalers available in the market. It could also challenge a consistent trend within the bull market of Nvidia and other Big Tech firms seeing their earnings estimates revised higher.
Bernstein’s Stacy Rasgon told Yahoo Finance’s Seana Smith the DeepSeek driven sell-off was “overblown.” Rasgon added that the brand new developments don’t spell out “doomsday for AI infrastructure.”
Josh Schafer is a reporter for Yahoo Finance. Follow him on X @_joshschafer.
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