Nvidia stock is down again. Should you buy the dip?

Nvidia (NASDAQ: NVDA) was among the tech stocks that fell today after the Bureau of Labor Statistics reported cooler-than-expected job growth in August. Just 142,000 jobs were added last month, below expectations for 161,000, and June and July figures were also revised down.

The news led investors to believe the economy is weakening faster than expected, which could be particularly damaging to growth and tech stocks like Nvidia, which are relying on billions in infrastructure spending to advance new generative artificial intelligence technologies (AI).

As a result, tech stocks fell largely by Nasdaq Composite was down 2.3% at 1:19 pm ET, and Nvidia was down 4% at the same time, after falling as much as 5.8% earlier in the session. The iShares Semiconductor ETF it also fell by 4%, which shows that the chip sector has been largely affected.

What it means for Nvidia

It’s been a tough week for the AI ​​chip leader. Shares fell on Tuesday, apparently on rumors that the Justice Department had issued it a subpoena related to an antitrust investigation, though Nvidia later said that was not true.

However, today’s pullback shows that the stock is sensitive to the broader macro environment. Investors believe that a recession or economic slowdown could put the brakes on the AI ​​boom, as it would discourage large tech companies and start-ups from investing in the new technology.

That would be a problem for Nvidia, as its business and high valuation are based on growing demand for data center GPU components, which are highly prized for their ability to run complex AI models.

Why it could be a buying opportunity

The jobs report is just one data point among many, and while there are other signs that the economy is weakening, it doesn’t look like a recession is on the way — the unemployment rate is still low at 4.2 percent.

Additionally, the Federal Reserve is expected to cut interest rates later this month, which should provide a boost to Nvidia and the broader economy.

The stock fell after last week’s earnings report, but its overall numbers were strong. The business continues to grow exceptionally fast and expects to ramp up production of its new Blackwell platform, which is already seeing strong demand, in Q4.

Finally, Nvidia’s biggest customers such as Microsoft, Alphabetand Meta platformsthey are unlikely to be bothered by a hiccup in the economy, as these companies have tens of billions of dollars in cash and have all declared investing in AI infrastructure a top priority.

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It would probably take a significant economic crash to derail their investment plans, meaning Nvidia is more protected from economic volatility than it might seem. That’s a good reason to bet on stocks rebounding from today’s slide.

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Randi Zuckerberg, former director of market development and spokeswoman for Facebook and sister of Meta Platforms CEO Mark Zuckerberg, is a board member of The Motley Fool. Suzanne Frey, chief executive at Alphabet, is a member of the Motley Fool’s board of directors. Jeremy Bowman has positions in Meta Platforms. The Motley Fool has positions in and recommends Alphabet, Meta Platforms, Microsoft, Nvidia and the iShares Trust-iShares Semiconductor ETF. The Motley Fool recommends the following options: long $395 January 2026 Microsoft calls and short $405 January 2026 Microsoft calls. The Motley Fool has a disclosure policy.

Nvidia stock is down again. Should you buy the dip? was originally published by The Motley Fool