Why Nvidia, Intel, Marvell, and Other AI Stocks Plunged Today

Many tech stocks fell on Friday, as the artificial intelligence (AI)-fueled rally ran out of steam.

Here’s how some of the top AI stocks fared today:

Missed Nvidia in 2009? This Rare Signal Is Flashing Again. In 2009, a “Double Down” signal flashed for a little-known chipmaker called Nvidia. For the first time in years, that same “Total Conviction” signal is flashing for a company 1/100th the size of Nvidia. Continue »

• Nvidia (NASDAQ: NVDA), down 6%

• Intel (NASDAQ: INTC), down 11%

• Nebius (NASDAQ: NBIS), down 12%

• Arm Holdings (NASDAQ: ARM), down 13%

• Marvell Technology (NASDAQ: MRVL), down 16%

The culprit

The downturn appears to have been sparked by a strong jobs report that stoked fears of interest rate hikes.

Many investors were hoping that the conflict in the Middle East would be resolved, energy prices would fall, inflation would subside, and the Federal Reserve would be free to cut interest rates.

Those hopes were dashed on Friday after job growth in May was much stronger than expected, with U.S. nonfarm payrolls rising to a seasonally adjusted 172,000 versus a consensus analyst estimate of 80,000.

While positive for job seekers, the report makes it harder for the Federal Reserve to justify rate cuts. Reducing interest rates when unemployment is already low can stoke inflation and overheat the economy.

Growth stocks are particularly sensitive to interest rate movements, as a higher portion of…