Nvidia's Record $39.01B Volume Surpasses U.S. Market Peers as Stock Slides Amid Sector Weakness Rising Yields and AI Competition from Alibaba

On September 2, 2025, Nvidia (NVDA) closed with a 1.95% decline, trading a record $39.01 billion in volume, the highest in the U.S. equity market. The stock’s pullback reflects broader sector weakness amid rising Treasury yields and geopolitical uncertainties, including recent legal challenges to U.S. trade policies. Analysts at UBS highlighted the downturn as a potential buying opportunity for investors underweighted in equities, emphasizing long-term growth in AI and technology despite near-term volatility.

Factors contributing to the decline include concerns over valuation metrics, with NVDA trading at a 48x forward P/E ratio, and macroeconomic pressures such as higher interest rates, which traditionally weigh on high-growth tech stocks. Additionally, Alibaba’s announcement of its own AI chip development added pressure to Nvidia’s premium valuation, signaling intensified competition in the AI hardware market. Meanwhile, options traders showed elevated activity, with significant open interest in both calls and puts, indicating heightened expectations for near-term volatility.

UBS analysts reiterated confidence in the tech sector’s resilience, noting historically strong returns in October and November despite September’s traditionally weak performance. They cited robust Q2 earnings, a $60 billion buyback program, and ongoing AI demand as tailwinds for Nvidia. However, the stock’s recent four-day losing streak, falling below key technical support levels, has sparked debates over whether AI spending momentum is stalling. Investors remain closely watching Nvidia’s planned presentation at the Goldman Sachs Communacopia + Technology Conference on September 8 for potential updates on market access and product roadmaps.

Backtest results indicate that NVDA’s post-earnings pullback has erased approximately $340 billion in market value, with shares now trading near a 60-day moving average. While short-term technical indicators remain bearish, long-term fundamentals—driven by Blackwell’s performance gains and expanding AI infrastructure—suggest the stock could stabilize if broader market conditions improve. Analysts caution that patience is key for long-term investors, as near-term price swings are unlikely to significantly impact multi-year returns.