Why Nvidia stock is down over 2% on Thursday

Nvidia NVDA stock fell more than 2% on Thursday, putting the shares on track to extend a two-day losing streak.

The move comes as higher oil prices and rising Treasury yields and fresh regulatory scrutiny weighed on the AI trade.

The broader market also moved lower. The Dow Jones Industrial Average fell 258 points, or 0.5%, while the S&P 500 declined 0.5% and the Nasdaq Composite slipped 0.4%.

US West Texas Intermediate crude futures for October delivery climbed above $100 a barrel, while Brent crude for November delivery jumped above $105 as the war between the US and Iran entered its seventh month.

The oil surge pushed the 10-year Treasury yield above 4.9%, its highest level since November 2023, adding further pressure to high-beta technology and semiconductor stocks.

Intel fell about 6%, while Micron Technology dropped roughly 4%.

DOJ examines Nvidia-Groq deal

Nvidia’s decline also comes as the US Justice Department examines whether the company structured its acquisition-related agreement with AI chip startup Groq to avoid antitrust scrutiny, according to Bloomberg.

The investigation centers on a deal announced in December under which Nvidia obtained rights to Groq’s technology.

Groq CEO Jonathan Ross and Chief Operating Officer Sunny Madra subsequently joined Nvidia, while Groq remained an independent company.

US lawmakers later characterized the arrangement as a takeover that limited competition.

The DOJ is examining licensing-and-hiring arrangements more broadly as regulators scrutinize how a small number of companies are consolidating influence over the AI industry.

Companies including Amazon, Microsoft and Alphabet’s Google have also faced scrutiny over arrangements that provide access to technology and engineering talent without necessarily triggering conventional merger review, according to the report.

Regulatory questioning of the Nvidia-Groq arrangement began earlier this year, as per the report.

The probe, previously reported by The New York Times, could ultimately end without enforcement action.

Groq did not submit its licensing agreement with Nvidia for antitrust review.

Nvidia expands AI strategy

The regulatory scrutiny comes as Nvidia continues expanding beyond its core semiconductor business.

Nvidia and Palantir Technologies announced a new AI collaboration on Wednesday focused on what they describe as “sovereign AI” for critical supply chains.

The system will initially operate within Nvidia’s own manufacturing and logistics network before being extended to other industries.

The collaboration combines Nvidia’s Nemotron open models with Palantir’s Foundry and AIP platforms and uses Palantir’s Ontology system to provide real-time visibility into supply-chain constraints.

The companies said the system will also help codify operational knowledge and accelerate decision-making.

Companies using the system will retain control of their own data and will not need to route it through a shared commercial AI model.

The partnership highlights the broader strategy Nvidia is pursuing as it seeks to capture value from the expansion of AI infrastructure and applications.