"Last month, we shared a storyabout Seaport Global Securities analyst Jay Goldberg, who defied the odds as the only voice out of 80 Bloomberg stock watcherswho rated Nvidia as a "sell." While Goldberg makes some very good points - mostly, that AI simply isn't proficientenough, at least yet, to justify its incredible chokehold on the US economy - the consensus on Wall Street has been firmly against him."
"All that is to say, conventional wisdom is that you'd be nuts to pull an investment in Nvidia right now. Yet that's exactly what Japanese investment firm SoftBank did on Tuesday, sending numerous tech stocks into a slide. According to Bloomberg, SoftBank disclosed it was pulling its $5.8 billion worth of holdings in Nvidia early Tuesday morning, ending its reign as one of the chip giant's most prominent backers."
"Overall, it would be awful news for the AI industry if it wasn't for one little wrinkle: SoftBank is planning on using its previous Nvidia holdings to back OpenAI, the private company behind ChatGPT. It's already given OpenAI $7.5 billion, with plans for another $22.5 billion soon, as Bloomberg reports."
SoftBank sold its $5.8 billion Nvidia stake, triggering a market drop that cut Nvidia roughly 2.6% and pushed other major tech stocks and the Nasdaq lower. Nvidia's market capitalization had briefly exceeded $5 trillion amid investor enthusiasm for AI, while a lone analyst had rated the company a sell due to AI's current limitations. The sell-off reflected concerns about concentration in AI investments and interdependence among tech firms. SoftBank plans to redeploy those Nvidia holdings to back OpenAI, having already invested $7.5 billion and planning another $22.5 billion. That move may stabilize markets in coming days.
Read at Futurism
Unable to calculate read time
Collection
[
|
...
]