Why Nvidia and Broadcom Look Like Bargains as Wall Street Overreacts to AI Slowdown Hysteria

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(SeaPRwire) –   By: Oliver Hawthorne, a Principal Correspondent permanently stationed at an international technology review.

Wall Street overreacted on Monday as a call for slower AI model development rattled semiconductor shares while Citi saw a buying opportunity. The Dow Jones Industrial Average dropped 152.09 points, or 0.29%, closing at 52,421.20. The S&P 500 fell 37 points, or 0.48%, to 7,619.98. The Nasdaq Composite slid 146.62 points, or 0.56%, to 26,186.41. Oil futures rose to $101.39 a barrel, marking the ninth gain in ten sessions, pushing inflation and rate expectations higher. The 10-year Treasury yield briefly topped 5%, its highest since July 2007, as Fed funds futures priced a 95% chance of a rate hike.

The selloff was triggered by Anthropic CEO Dario Amodei calling for a multilateral slowdown in AI model development, a plea backed by Sam Altman and Elon Musk. Microsoft responded with a provisional AI code of conduct, lifting its shares 2%. Semiconductor stocks bore the heaviest pain, with Nvidia falling 3.4% to $210.96 and the PHLX Semiconductor index dropping 5.9%. Corning, supplying fiber-optic materials for data centers, plunged 14% to $143.60. If major AI labs throttle model development, data center demand could cool, directly hitting chip sales and pricing.

Citi countered the panic by labeling AI spending fears overdone in a note to investors. The bank highlighted pushback from Nvidia and Broadcom management, with Broadcom targeting $115 billion in AI chip revenue by fiscal 2027. Citi argued that U.S.-China technology competition makes a large pullback in AI investment unlikely, noting President Trump’s emphasis on maintaining a tech edge. The bank rates both Nvidia and Broadcom as Buy, with price targets of $315 and $515 respectively, suggesting a slower rollout might even support longer-term capital investment.

The street consensus must confront the structural reality that strategic AI leadership cannot be surrendered lightly. Gradual infrastructure deployment may cushion equipment vendors while sustaining long-term innovation cycles. Nvidia and Broadcom offer immediate leverage amid this overreaction. Author bio: Oliver Hawthorne, a Principal Correspondent permanently stationed at an international technology review.