It is undeniable that the US stock market has been caught up in a state of instability over the past few weeks. As geopolitical tensions continue to rise, concerns have risen about how economic vulnerabilities will affect Wall Street. This has led to Nvidia (NVDA) falling 30% from 2024, but in reality it could be better than it appears.
The major reason for the recession is the tariff policy of President Donald Trump on the day of US liberation. BlackRock CEO Larry Fink called the plan one of the worst in 49 years of finance. If a resolution on a drastic economic policy is then found, AI chip makers could be the best one to make a profit.
Nvidia will fall amid the terrifying market in 2025, but the company still looks strong
The stock market is becoming increasingly volatile amid the potential recession in the US. At this point this year, uncertainty is a common theme. Furthermore, Nvidia is no exception. Stocks rose more than 3% on Friday, but have fallen more than 18% over the past 16 months.
Despite growing geopolitical and economic concerns, there are reasons for hope for stocks that rose 174% last year. In fact, stocks could be better than investors as NVIDIA (NVDA) has fallen 30% from its 2024 high.
There is reason to believe that economic headwinds are a major player in recent decline. That being said, the important silver lining is likely to make them sort out faster than they would later. Countries such as India and the European Union are all seeking new trade deals with the United States. China’s trade war concerns still exist, but there are still progress to overcome the trade.
As things move forward, we can expect advances in the high-tech industry. Furthermore, it is supposed to support Nvidia in the long term. Jensen Huang, the company’s CEO, recently predicted that spending in the data center industry could jump to $2 trillion over the next five years.
This has already begun, with companies like Amazon (AMZN), Meta Platforms (Meta), Alphabet (Googl) and Microsoft (MSFT) spending $320 billion this year. With NVIDIA processors accounting for 70% to 95% of all AI processors, the company will boom when this spending pays off over the next few years.
