The &#34;technology faith&#34; of the US stock market has been shaky recently. In just two days, the combined market value of Apple and NVIDIA has shrunk by $250 billion.
Overnight, Apple stocks continued to plummet, dropping more than 5% at the opening, and still falling nearly 3% at the close. With a consecutive two-day decline and a total decline of 6.4%, the market value evaporated by $190 billion.
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NVIDIA, the biggest winner in the technology sector this year, also faced selling pressure. It fell more than 4% at one point during overnight trading, but narrowed the decline to 1.7% at the close. NVIDIA has experienced a two-day decline with a total decline of 5%, resulting in a $60 billion market value shrinkage.
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An article from Wall Street CN pointed out that the rise in oil prices and the resilience of the US economy, which highlighted inflation concerns, have led to an increase in hawkish expectations for the Federal Reserve. This is one of the main reasons for the recent sell-off of technology stocks. However, the factors causing the decline in Apple and NVIDIA stock prices go beyond this.
<h2>The Reasons behind the Decline of Two Tech Giants</h2>
The main reason for the decline in Apple's stock price is investors' growing concerns about its performance in the largest single market, China.
According to China Fund News, on the one hand, the upcoming release of the iPhone 15 series next week will intensify competition with the popular Huawei smartphones. On the other hand, there have been reports that the iPhone has been banned in certain situations.
In addition, the European Union announced the first list of services subject to the most stringent digital regulatory law, the Digital Markets Act (DMA), on Wednesday. Apple is prominently included among the six &#34;targeted entities&#34; in this list. Furthermore, Google's parent company Alphabet, Amazon, Meta, and Microsoft are also on the list.
As NVIDIA's stock price plummeted, a terrifying conspiracy theory was circulating on the social media website X (formerly known as Twitter).
According to a previous article from Wall Street CN, there were indications that NVIDIA artificially inflated the revenue of CoreWeave, a cloud computing company it invested in, thereby exaggerating the income of its AI business. It is reported that the valuation of this startup company is approximately $8 billion.
However, Wall Street analysts quickly refuted this claim.
Analyst Stacy Rasgon from Bernstein wrote in a report to clients on Thursday that this theory is &#34;baseless talk,&#34; and he reluctantly issued this report, encouraging investors not to believe the naive investment arguments seen on Twitter.
Regarding the skepticism about Nvidia's doubled revenue and only 7% increase in sales costs, Rasgon stated that this is because the expenses recorded by Nvidia in the second quarter include a provision for inventory of approximately $1.22 billion, which was included in the cost of sales in the second quarter of last year. &#34;When these expenses are excluded, the sales costs in the second quarter actually increased by about 70% compared to a year ago, which is completely normal.&#34;
The second mainstream doubt involves Coreweave, a major Ethereum miner in North America that has transitioned into a GPU cloud provider. Rasgon reminded that the company mortgaged Nvidia H100 chips in exchange for debt financing led by Blackstone Group, not Nvidia's major shareholder BlackRock. The misinterpretation of this conspiracy theory itself is ridiculous enough.
Supporters of Nvidia generally believe that the popular conspiracy theories on social media only indicate one thing, that the long and short game against Nvidia is highly competitive. The underlying logic may stem from deep fear and concern about the &#34;AI-driven burst of the next tech bubble.&#34;
Is the future still uncertain?
What does the plunge of Apple and Nvidia mean for tech investors?
Yahoo Finance reporter Jared Blikre pointed out in his latest article that history has shown that when Apple falls out of favor rapidly, it often leads to long-term declines, which means that its stock price may encounter difficulties in the future.
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In fact, we have already broken through the 50-day moving average, and now Apple is being heavily sold off from this position again. This is a clear technical signal that we should remain cautious about potential further declines.
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In addition, Nvidia's inability to break through the high point of $499 on earnings day has raised concerns among investors and intensified risk aversion. Blikre added,
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Nvidia has not been able to climb to that high point yet. Therefore, even though it is still close to its record high, I remain somewhat cautious at this point.
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Both Apple and Nvidia have reached historic highs in their stock prices this year. Apple has steadily risen by 42% year-to-date, thanks to stable growth of 5% and 6% in the first and second quarters, respectively. Nvidia's stock price has more than doubled due to the explosion in demand for AI chips. In comparison, the tech-heavy Nasdaq index has only risen by 32%.

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Investors are becoming increasingly concerned about Apple's performance in its largest single market, China, while Nvidia is being attacked by conspiracy theories.

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Is the faith in technology still strong? Apple and NVIDIA have both experienced consecutive declines, resulting in a total drop of $250 billion this week.