Nasdaq Index: Nvidia Weakness Weighs on US Stocks as AI Chip News Hits Sentiment

Tech Stocks Slip as Nvidia Takes a Hit — Is the AI Trade Losing Some Steam?

Traders are stepping into the session with one story front and center: Nvidia sliding more than 3% premarket after reports that Meta may use Google’s AI chips. The reaction is immediate — sentiment across tech is softer, and the market is once again questioning how much competition Nvidia may have to absorb over the next few years.

The timing adds weight, with Sandisk entering the S&P 500, several major earnings due from software to hardware names, and retail sales and PPI landing before the bell.

The setup feels heavier than a typical Tuesday. You’ve got headline pressure, valuation worries, and a market that hasn’t given tech much room for error over the past week. Buyers are showing interest on dips, but today they’ll need more convincing.

Is Google Stealing a Bit of Nvidia’s Spotlight?

The Information reports that Meta is exploring Google’s tensor processing units starting in 2027 and may rent TPUs from Google Cloud as early as next year. That’s not an immediate blow to Nvidia, but it’s a clear signal that major buyers are testing alternatives.

Traders know Nvidia still dominates GPU supply for AI systems, yet Google’s custom chip strategy is gaining traction, and today’s premarket reaction shows how quickly investors react to competitive threats.

Alphabet is up roughly 3% after Monday’s rally, while Broadcom — a design partner for Google’s TPUs — is adding another 2% after an 11% jump yesterday.

Is Sandisk’s S&P 500 Debut a Sign of Tech’s Growing Weight?

Sandisk is up 7% after being added to the index, replacing Interpublic. Forced buying from index-trackers usually supports these names into and after inclusion. It also underscores how tech-heavy the S&P 500 has become, with AppLovin, Datadog, DoorDash and Robinhood joining earlier this year.

Sandisk’s latest quarter showed revenue up 23% and a 31% jump in exabytes sold, and attention now turns to whether it can secure more data-center deals in a crowded space.

What’s the Market Watching Heading Into a Packed Earnings Day?

Alibaba, Autodesk, NetApp, Applied Digital and Zscaler all report today, setting up a busy session for traders watching software and AI infrastructure demand. Workday’s print carries added weight as it’s the first since Elliott took a stake.

After the close, Dell and HP report following analyst downgrades tied to rising memory costs, with Deere on deck tomorrow to provide a read on construction and agriculture spending.

Does Dell’s Preview Point to Tougher Margins Ahead?

Options imply roughly a 9% move when Dell reports. Wall Street expects EPS of $2.47 on revenue around $27 billion, but commentary on margins and memory costs will drive the reaction.

Analysts warn higher DRAM and NAND prices could pressure fiscal 2027 profitability, and Morgan Stanley’s downgrade to Sell shows how sensitive the stock has become to any cost concerns. Traders want clarity on AI demand and whether Dell can hold margins into next year.

Near-term outlook: sentiment leans slightly bearish into the open. Nvidia’s drop is pulling tech lower, and with PPI and retail sales hitting at the same time earnings roll in, the market may hesitate to commit to risk early. Buyers could step in later, but the first move is likely to be choppy rather than directional.

More Information in our Economic Calendar.