Nvidia Stock Bounces 2% as Chip Rebound Follows Brutal Friday Rout, Even as Melius Slashes Price Target
Nvidia (NVDA) shares rose 1.8% on Monday, rebounding from a 4.22% drop on Friday, as chip stocks recovered from a broader sell-off. Melius Research cut its price target to $315 from $420 but maintained a buy rating. Nvidia's stock has fallen about 10% in October but is up 15% year-to-date. Investors await quarterly earnings later this month amid concerns about AI spending.
How this was made
The 30-second read
Why it matters
The price‑target reduction introduces downside pressure, but the 2% bounce suggests short‑term support at the 200‑day average.
Market read
Nvidia's move influences broader semiconductor sentiment and AI‑related equities.
What to watch
Upcoming earnings later this month could either validate the bounce or expose weakness.
Background
Nvidia led a recovery in chip stocks after a sharp sell‑off driven by AI spending worries and a weak Intel outlook.
Ticker impact
Melius Research cut its price target on Nvidia to $315 from $420, while the stock bounced 2% in early trading.
likely modest upward pressure as traders weigh the target cut against the bounce support level
Analyst downgrade provides a fresh catalyst, yet the stock's immediate price gain shows resilience, leading to a balanced outlook.
Market effects
Chip sector may see mixed reactions as AI spending concerns persist while the bounce could lift peers.
U.S. tech‑heavy indices may see slight upside from Nvidia's rebound.
Limited to AI‑related hardware makers worldwide.
Counterpoint
The target cut may signal deeper demand concerns; a sharper pullback could follow the bounce.
Key entities
- analystMelius Research
Research firm that lowered Nvidia's price target.
- peerIntel
Chipmaker that posted a weak outlook, contributing to sector weakness.
