(Bloomberg) — Asian semiconductor stocks fell after a disappointing outlook from major chipmaker Nvidia Inc dampened investor sentiment toward artificial intelligence deals.
Most read articles on Bloomberg
Among Nvidia suppliers, shares of South Korean memory maker SK Hynix fell 6.8%, while Japanese tester maker Advantest lost 3.6% and shares of major foundry Taiwan Semiconductor Manufacturing Co. (TSMC) dropped 2.8%. The Bloomberg Asia Pacific Semiconductor Index fell 2.7%, trimming this year’s gains to about 22%.
“Nvidia had a strong performance, but the stock price fell on high expectations for next year,” said Jun Bei Liu, a portfolio manager at Sydney-based Tribeca Investment Partners. The stock’s cooling after a strong performance this year “presents a buying opportunity as the long-term structural growth is intact,” he said.
The company’s shares fell more than 8% in late trading on Tuesday after it gave sales guidance that missed analysts’ highest estimates and warned of disruptions to production of Blackwell’s new chips. The announcement could add to concerns about the AI overheating that has sparked a recent stock market sell-off and a return to a sector that’s out of favor.
That could lead to further profit-taking in a bull market that has lifted the Nasdaq 100 by 15% so far this year.That said, analysts remain generally positive on Nvidia’s prospects.
“The tailwinds are still very strong,” Kyle Rodda, a market analyst at Capital.com Inc., said in an interview on Bloomberg Television. “We’re now talking about this stock like a regular stock and considering whether the risk this company is taking at this price is appropriate.”
Most read articles on Bloomberg Businessweek
©2024 Bloomberg LP
