Nvidia Stock Price Drops After Hawkish Fed Speech
Nvidia's stock price has been experiencing a downward correction after its earnings report released on August 26 exceeded expectations, driving a surge of nearly 9% in its stock price to close at $227.98.
The company's shares dropped 4.57% last Friday to close at $217.55, following a bearish candlestick that dealt a heavy blow to market expectations for a bullish push to new highs.
Federal Reserve Chair Warsh delivered a hawkish speech at the Jackson Hole annual central banking symposium on August 31, warning of sticky services inflation and a still-tight labor market, which cooled rate-cut expectations and directly hammered rate-sensitive megacap tech and semiconductor stocks.
Nvidia's revenue base is expanding, but year-over-year revenue growth is slowing down, leading to high expectations for the magnitude of earnings beats. Failure to meet these expectations can trigger profit-taking selling pressure.