Market Shock: Nvidia Plummets, Paramount & Xpeng Surge
- Tech Sell-Off: Nvidia and CoreWeave shares tumbled in premarket trading after SoftBank sold its entire stake in the chipmaker, sparking widespread anxiety over high-priced tech valuations.
- Paramount's Rally: Propelled by an aggressive new strategy, Paramount Skydance shares soared after the new leadership announced deeper job cuts and a $3 billion cost-saving target.
- Xpeng's Futuristic Surge: Chinese EV maker Xpeng surged on growing investor excitement over its ventures into advanced technologies like humanoid robots and robotaxis, reshaping its market valuation.
A Market Divided: Tech Tumbles as Turnarounds Triumph
The premarket session painted a stark picture of a divided Wall Street, where fears of overvaluation sent shockwaves through the AI sector while bold corporate shake-ups and futuristic technology fueled massive rallies elsewhere. Tech giants Nvidia and CoreWeave faced a brutal sell-off, while Paramount Skydance and Xpeng enjoyed significant investor enthusiasm.
Anxiety Hits High-Flying AI Stocks
Shares of chipmaking behemoth Nvidia (NVDA) slipped, but the real damage was felt by CoreWeave (CRWV), a company that rents out access to AI chips, which saw its stock plummet. The downturn was triggered by the news that SoftBank Group had liquidated its entire stake in Nvidia, a move that rattled traders and intensified existing anxieties about sky-high valuations in the technology industry. The slump at CoreWeave, whose business is intrinsically linked to powerful AI hardware, provided investors with another reason to question the sector's current strength.
Paramount Soars on Aggressive Cost-Cutting Strategy
In stark contrast, Paramount Skydance (PSKY) shares soared in early trading following its first financial report since a new investor group took control in August. The media giant impressed Wall Street by raising its targets for cost-saving initiatives and job cuts. In a letter to shareholders, the company announced plans for an additional 1,600-person workforce reduction, aiming to achieve at least $3 billion in cost savings. This decisive action, coupled with its ongoing efforts to acquire rival Warner Bros. Discovery Inc., signaled a bold new direction that investors eagerly embraced.
Xpeng's Robot Ambitions Fuel Investor Excitement
Meanwhile, American depositary receipts of Chinese electric vehicle maker Xpeng (XPEV) surged by 16%, driven by a wave of optimism surrounding its technological progress beyond cars. Investors are no longer viewing Xpeng as just an EV company. Its recent showcase of cutting-edge innovations—including the IRON humanoid robot and advancements in robotaxis—has fueled enthusiasm about its long-term potential. While these futuristic projects have yet to impact near-term earnings, they are fundamentally reshaping market perceptions of Xpeng’s valuation and future growth prospects.
