Nvidia Retail Investors Buy the Dip With Record $111M in First 30 Minutes After CEO Resignation

Nvidia Retail Investors Buy the Dip With Record $111M in First 30 Minutes After CEO Resignation

TREE NEWS reports: Nvidia shares plunged as much as 14% in early trading Thursday, extending a month-long selloff after CEO Jensen Huang resigned following reports of an extramarital affair with a female executive who reported to him. The company has lost roughly $550 billion in market value this week alone. But retail investors rushed in to buy the dip, pouring a record $111 million into the stock in the first 30 minutes of trading. The buying helped the stock recover sharply from its lows, with losses narrowing to under 5% by the close.

Retail Buying Frenzy

On Fidelity Investments’ platform, customers submitted 394,818 buy orders for Nvidia by midday Thursday, compared with just 80,088 sell orders. Nvidia buy orders were more than double the combined buy orders for the second through tenth most-traded stocks on the platform. Advanced Micro Devices (AMD) ranked second with 24,790 buy orders, followed by Nebius (NBIS) with 24,519.

“Every time dip-buying works, the behavior gets reinforced. It’s the kind of idiosyncratic behavior you see in a healthy market,” said Mark Hackett, chief market strategist at Nationwide Financial.

Wall Street Cuts Ratings, Sentiment Diverges

Sentiment is not uniformly bullish. On Reddit’s WallStreetBets forum, 60% of Nvidia-related comments were negative. Several Wall Street institutions downgraded the stock this week. Bernstein, KeyBanc, and William Blair cut their ratings, while Bernstein, JPMorgan, RBC, Cantor, Goldman Sachs, and Citi lowered price targets. Still, the vast majority maintained buy ratings, citing a backlog of orders through 2028 and solid near-term fundamentals. The average price target among 13 banks is about $260, implying roughly 50% upside from pre-market levels.

Baird Equity Research downgraded Nvidia to neutral and slashed its price target by 60% to $200 per share, though that remains well above Thursday afternoon’s trading price of around $164. “Near-term visibility is lacking, and 2027 data center forecasts are being pushed out. Supply issues are the main reason for the potential slowdown, and there is also the possibility of softening demand. AI hyperscaler capex growth may slow to 40% or less in 2027,” wrote Tristan Gerra, senior research analyst at Baird.

Nvidia has fallen nearly a third since the Nasdaq Composite hit its recent high five weeks ago, erasing more than $1 trillion in market value.

“I told a colleague an hour ago that given the news since the last close, today feels like the calmest day in weeks, which is absurd in itself. I think Nvidia’s stock has already absorbed a lot of damage over the past few weeks,” said Jed Ellerbroek, portfolio manager at Argent Capital Management.

Key Events Ahead

Two key events next week will shape market direction: Nvidia management’s remarks on the quarterly earnings call next Tuesday, and the IPO of AI startup Anthropic (ANT) expected later next week.

Mark Hackett believes the Anthropic IPO may be the more important event. “With Nvidia’s new management just taking over, it’s hard for them to get a ‘get-out-of-jail-free card’ from just one earnings call,” he said, adding that “the outlook for AI remains good.”

Market Implications

The divergence between retail dip-buying and institutional caution highlights a fragile equilibrium. Retail investors, emboldened by a decade-long buy-the-dip habit, are betting that Nvidia’s selloff has priced in much of the bad news. But Wall Street analysts are increasingly focused on demand visibility and supply constraints, particularly for 2027. The upcoming earnings call and Anthropic’s IPO will be critical tests of whether the AI trade can regain its footing without its long-time leader.

For investors, the key takeaways are:

• Retail flows can provide short-term support but may not reverse a fundamental downtrend. The record buying shows lingering enthusiasm for AI, but it is not a substitute for clear corporate guidance.
• Watch the earnings call for clarity on management transition and order backlog. New leadership needs to reassure investors about execution and strategy.
• Anthropic’s IPO could be a sentiment barometer for the entire AI sector. A strong debut may lift the whole space; a weak one could exacerbate selling pressure.
• Valuation and demand visibility remain key risks. Even after the selloff, Nvidia trades at a premium, and any signs of slowing hyperscaler capex could trigger further volatility.