Billionaire Steve Cohen remains optimistic on AI despite market volatility, with Nvidia seeing a drop.

From CNBC: 2025-01-28 15:35:53

Billionaire investor Steve Cohen remains optimistic about AI’s long-term potential, despite recent market volatility. Cohen emphasized the transformative impact AI will have on various industries and cautioned that misinformation could exacerbate investment volatility in the sector. Nvidia, a key player in AI, saw a massive 17% drop in market value on Monday.

Cohen’s comments came after young Chinese AI startup DeepSeek caused a significant sell-off in U.S. tech stocks. Cohen highlighted the episodic nature of AI growth, noting that misinformation and lack of understanding among investors may lead to fluctuations in the market. Nvidia experienced its biggest single-day market value drop ever, losing almost $600 billion in value.

Despite the recent market turmoil, Cohen’s firm, Point72, has raised $1.5 billion for a new AI-focused hedge fund. Cohen sees AI as a long-term theme with significant potential for growth, emphasizing the importance of understanding the technology and its impact on various sectors. Nvidia rebounded with a 7% increase in share price on Tuesday following the significant drop.

Read more: Steve Cohen says AI will be decades-long theme, but Monday proves it won’t be a ‘straight line’