Investing.com -- The tech sector saw significant activity this week, with major names experiencing both rises and falls. Here's a look at some of the names that stood out:
NVIDIA took a significant hit this week, plunging over 16% on Monday after the launch of DeepSeek, a competing AI platform. The Chinese company’s R1 artificial intelligence (AI) model reportedly performs at a similar level to Western models at a significantly lower cost.
It triggered a decline in AI stocks, dragging down other related names like Broadcom (NASDAQ: AVGO ), Dell (NYSE: DELL ), and Super Micro Computer (NASDAQ: SMCI ). The market reacted with concern about increased competition and potential disruption in the AI space.
Following the news, Morgan Stanley (NYSE: MS ) lowered its price target for Nvidia (NASDAQ: NVDA ) from $166 to $152, citing investor concerns sparked by the DeepSeek AI model.
While the bank highlighted ongoing robust demand for Nvidia’s next-generation Blackwell products, it also acknowledged the current short-term headwinds.
Despite reporting earnings that many considered lackluster, Tesla shares gained ground.
The electric vehicle giant missed top and bottom-line expectations. However, CEO Elon Musk's bullish outlook on the company's future seemed to resonate with investors, highlighting promising developments in autonomous driving, and the the forthcoming "Cybercab," painting a picture of ambitious growth.
JPMorgan analysts said that while it wasn’t clear to them why Tesla’s stock rose, they have some theories.
“Perhaps it was management’s statement that it had identified an achievable path to becoming worth more than the world’s five most valuable companies taken together,” said the bank. “Or maybe it was management’s belief that just one of its products has by itself the potential to generate “north of $10 trillion in revenue”.”
They added that It may have also been “related to management guidance for 2026 (no financial targets were provided, but it was said to be “epic”) and for 2027 and 2028 (“ridiculously good”).
“What does seem clear is that the move higher in Tesla shares bore no relation whatsoever to the company’s financial performance in the quarter just completed or to its outlook for growth in the coming year,” JPMorgan concluded.
The broader tech sector delivered a mixed bag of results this week. Microsoft (NASDAQ: MSFT ) experienced a decline following its earnings release, as its cloud forecast disappointed.
UBS lowered its target for Microsoft to $510 from $525, maintaining a Buy rating on the stock following the release.
They said, "Microsoft posted a weaker-than-expected quarter, marked by the company pulling its guidance for a 2H (Mar/Jun 2025) Azure acceleration, blaming sales execution.
“Three straight quarters of an Azure disappointment (different explanation each time) undermines confidence in the growth outlook.”
On the other hand, Meta (NASDAQ: META ) and Apple (NASDAQ: AAPL ) saw their shares rise, following earnings releases, with both topping consensus earnings and revenue expectations.
Focusing on Apple, Evercore ISI said the iPhone maker “reported a largely inline Dec-quarter but provided a march-quarter guide that was ahead of buyside fears as they are seeing plenty of offsets to weaker China demand environment.”
Meanwhile, focusing on Meta, JPMorgan said the company delivered strong 4Q results.
“DeepSeek was an important focus,” added the bank. “While Meta does not seem to have all the answers yet, management expects to be able to leverage DeepSeek’s advances & emphasized that Meta’s heavy investments in capex & infrastructure will be strategic advantages over time.”