Nvidia Stock Drops Amid Middle East Conflict Fears, Chip Sector Under Pressure
Nvidia shares fell 3% on Friday, extending losses in premarket trading Monday as escalating Middle East tensions rattled global markets. The chipmaker's decline mirrored broader sector weakness, with TSMC dropping 4.2% and Korean memory chip makers SK Hynix and Samsung falling 9.5% and 7.8% respectively.
Brent crude briefly topped $119 per barrel - levels unseen since 2022 - as energy market volatility compounded supply chain concerns. While semiconductor fabs face no immediate shutdown risk, analysts warn of mounting margin pressure from rising energy and transportation costs. "The tech sector's vulnerability lies in inflationary pressures rather than production halts," noted Circular Technologies' Brad Gastwirth, highlighting semiconductor manufacturing's extreme energy intensity.
The Dow Jones Industrial Average posted its worst weekly performance since April 2025, shedding 3% as G7 ministers convened to discuss strategic petroleum reserve releases. AMD and Broadcom followed Nvidia downward, declining 3.52% and 0.69% respectively in premarket activity.
