Yahoo Finance Live's Jared Blikre breaks down midday trading in the stock market.
Ever since Nvidia (NASDAQ: NVDA) released strong earnings results for the third quarter of fiscal 2022 on Nov. 17, 2021, the stock has been going downhill, due to a variety of factors out of the company's control. Shares of the graphics card specialist are down 30% since its Q3 report as the strong probability of interest rate hikes by the Federal Reserve and the crash in cryptocurrencies has weighed on investor sentiment. After all, interest rate hikes are bad news for richly valued companies such as Nvidia as rising U.S. Treasury yields mean that investors can get more returns by shifting their money to safer assets.
ASML (NASDAQ: ASML) and Nvidia (NASDAQ: NVDA) are two very different kinds of companies, but the latter likely wouldn't exist without the former. ASML, which is based in the Netherlands, is the world's top manufacturer of lithography systems -- which are used to etch circuit patterns onto silicon wafers. The world's top chip foundries -- including Taiwan Semiconductor Manufacturing Company (TSMC), Samsung, and Intel -- all use its top-tier extreme ultraviolet (EUV) systems to manufacture the world's smallest and densest chips.