Here's Why CoreWeave Stock Plunged but Then Recovered This Week

Core Insights - Investors are evaluating whether AI spending will positively or negatively impact companies like CoreWeave [1][2] - The stock market experienced volatility, particularly in the tech sector, with CoreWeave's shares initially dropping 20% before recovering [1][2] Company Performance - CoreWeave's stock ended the week down 3.4%, reflecting investor uncertainty regarding AI spending [2] - The stock price fluctuated significantly, with a current price of $89.61 and a market cap of $45 billion [6][7] Industry Trends - Major tech companies, including Alphabet and Amazon, announced substantial AI capital spending plans, collectively guiding expectations for at least $600 billion in AI spending this year [4] - Despite the potential benefits of increased spending for companies like CoreWeave, concerns about a possible AI spending bubble have emerged, leading to initial sell-offs [5] Market Sentiment - Nvidia CEO Jensen Huang's comments on the sustainability of capital expenditures helped restore confidence in the market, contributing to CoreWeave's stock rebound [7]