Even Retail Investors Halted 'Buying the Dip'... Nasdaq Sees Largest Plunge in 7 Months

Amid concerns that artificial intelligence (AI) sector stocks are overvalued, the Nasdaq Composite Index posted its largest weekly drop in seven months on the U.S. stock market last week.

On the 5th, the won/dollar exchange rate approached 1,450 won during the day, facing multiple adverse factors such as domestic and international stock market adjustments and a preference for safe assets. The exchange rate is displayed at a currency exchange booth in Myeongdong, Seoul. Photo by Yonhap News Agency

According to the Wall Street Journal (WSJ) and other sources on November 8 (local time), the Nasdaq Index fell by 3% on the New York Stock Exchange during the week of November 3 to 7. This was the largest weekly decline since the first week of April (March 31 to April 4), when it plunged by 10%. At that time, the New York stock market was shaken after U.S. President Donald Trump announced a reciprocal tariff plan on "America Liberation Day."

Looking at major stocks, Palantir, which reported earnings, plummeted by 11%. In addition, Oracle dropped by 9%, Nvidia by 7%, Meta by 4%, and Microsoft by 4%. The combined market capitalization of the top eight AI-related stocks, including these, decreased by about 800 billion dollars (approximately 1.166 trillion won) over the past week. Nvidia, which surpassed a market capitalization of 5 trillion dollars for the first time ever on October 29, lost about 350 billion dollars (about 510 trillion won) in market value during this period.

Along with the AI bubble theory, several negative economic factors further dampened investor sentiment. The U.S. federal government shutdown, which broke the record for the longest duration at 36 days, also halted the release of economic indicators that provide information to investors. Reports of worsening consumer sentiment and expanded corporate layoffs also negatively affected investor confidence.

Even investors who had been buying on dips during the downturn stopped purchasing. Palantir saw retail investors turn net sellers. Individual investors also took profits in quantum computing-related stocks, which had surged earlier this year.