Becker Private Equity & Business Podcast
The Markets Are Tanking: 5 Stories We Are Following Today 1-27-25
Mon, 27 Jan 2025
In this episode, Scott Becker breaks down the major market downturn, highlighting a 13% drop in NVIDIA’s stock amid concerns over a disruptive Chinese AI breakthrough.
Chapter 1: What are the main stories in today's market downturn?
This is Scott Becker with the Becker Private Equity and Business Podcast. Today's discussion is the markets are tanking five stories we're following this morning. So first, the biggest story today is the falling market indexes, the NASDAQ down about 3%, the S&P down about 1.5% currently. And again, number two,
Chapter 2: What are the reasons behind NVIDIA's stock drop?
This market drop is due to the concern that a Chinese tech company may have a cheaper and more advanced way to run AI without super expensive chips. This is very negative for NVIDIA, that whole ecosystem built around AI chips.
Chapter 3: How could a Chinese tech company disrupt the AI market?
Third, Bloomberg reports, again, that this could potentially derail the investment case for the entire AI supply chain, which is driven by large art spending from a handful of hyperscaling companies. Fourth, NVIDIA is down about 13% right now. This puts it in the market cap wars back behind Apple and Microsoft. So Apple's on number one, Microsoft number two, NVIDIA number three.
Chapter 4: What does NVIDIA's decline mean for the AI supply chain?
Just last week, it was NVIDIA number one, Apple number two, Microsoft number three. NVIDIA is now giving up that lead again. And we'll see how this all plays out over time. Don't take too much out of any one day's reports and actions and so forth. Fifth, the five largest companies by revenues in the US, Walmart, Amazon, Apple, United Healthcare, and Berkshire Hathaway.
Those are the five largest by revenues. The last thing I'll note, which is a PS, days like this in the market are a stark reminder that you want to have an allocation you could live with. For me, it's a relatively conservative allocation. So don't freak out too much when the market has days like this. When I wake up this morning and see futures are down 2.5% to 4%, it's always a bad day.
But I don't freak out as much as I would if 100% of my assets were in equities. But of course, in years when things are going great, I don't make as much money either. In any event, thank you for listening to the Becker Private Equity and Business Podcast. It is great to be with you. Thank you so much for joining us.