Fears of a growing bubble around the artificial intelligence frenzy resurfaced on Thursday as leading US stock markets fell, less than 24 hours after strong results from chipmaker Nvidia sparked a rally. Wall Street initially rose after Nvidia, the world's largest public company, reassured investors of strong demand for its advanced data center chips. But the relief dissipated, and technology stocks at the heart of the AI boom came under pressure. The benchmark S&P 500 closed down 1.6%, and the Dow Jones industrial average closed down 0.8% in New York. The tech-focused Nasdaq Composite closed down 2.2%.

Asian markets recorded the sharpest slide in seven months on Wednesday. Asian markets recorded the sharpest slide in seven months on Wednesday. Global stock markets have fallen sharply amid concerns that a boom in valuations of artificial intelligence (AI) companies could be rapidly cooling. Markets in the US, Asia and Europe have fallen after bank bosses warned a serious stock market correction could lie ahead, after a run of record stock market highs led some companies to appear overvalued . In the US, the tech-focused Nasdaq and the S&P 500 on Tuesday suffered their largest one-day percentage drop in almost a month.

Is the US eyeing its next Latin American target? Why is Trump tearing down parts of the White House? Nvidia has become the first company to reach $5 trillion in market value amid a global artificial intelligence arms race. The chipmaker surge on Wednesday came only three months after the company topped the $4 trillion mark . Since the launch of ChatGPT in 2022, Nvidia's shares have climbed 12-fold as the AI frenzy propelled the S&P 500 to record highs, igniting a debate on whether frothy tech valuations could lead to the next big bubble.

US tech giant Nvidia will invest up to $100bn (£73bn) in OpenAI, the firm behind ChatGPT, the companies announced. Nvidia said it will supply high-performance chips needed for the processing power required by artificial intelligence (AI), of which OpenAI is a specialist. Described as a strategic partnership by Nvidia, it is the latest move by two high profile tech firms in the global AI race, where China is an emerging rival. The announcement comes after a series of high-profile investments by Nvidia, including a $5bn investment in Intel and a £2bn investment in the UK's AI sector. Nvidia said its latest investment will go towards growing data centres for OpenAI's next-generation AI infrastructure.

The deal, announced during a developers' conference in Munich, underscores the importance of computing power even for partially autonomous systems, which are not designed for full self-driving but offer drivers assistance, such as lane keeping or emergency braking.

The U.S. chipmaker has diversified its revenue streams by turning to new growth areas such as data centers, artificial intelligence and self-driving cars, while also benefiting from robust sales in its biggest business of supplying graphics chips used in gaming.

Nvidia's shares have fallen by about 9.5 percent since the company said on Tuesday it was temporarily halting its self-driving tests on public roads out of respect for the victim in the March 18 accident involving an Uber self-driving vehicle.

The announcement is the latest of many collaborations for Nvidia, whose Drive platform that helps enable autonomous driving is ubiquitous in the industry. The Silicon Valley-based company known for its graphics chips said last month that 320 companies involved in the development of self-driving cars use Nvidia Drive.

TAIPEI (Reuters) - Nvidia Corp chief executive Jensen Huang said on Thursday artificial intelligence would enable fully automated cars within 4 years, but sought to tamp down expectations for a surge in demand for its chips from cryptocurrency miners.