Nvidia shares surged 7.8% to $185 amid a brutal software market collapse, with the S&P 500 software index plummeting 4.6% and losing $1 trillion in value. Investors fled software stocks fearing AI disruption while flocking to chip makers like Nvidia. The Dow closed above 50,000 as Wall Street embraced "picks-and-shovels" trades during this volatile period.

Jensen Huang delivered a stark reality check, calling AI's threat to software "illogical." The Nvidia CEO argues AI enhances rather than replaces existing tools, noting current AI successes rely on exploiting established software. Meanwhile, Big Tech plans a $600 billion AI spending surge in 2026, with Amazon outlining a massive $200 billion capital outlay that spooked investors already questioning ROI.

Nvidia is reportedly close to investing $20 billion in OpenAI as part of a $100 billion fundraising round valuing the ChatGPT maker at $830 billion. The market has split into clear winners and losers: AI infrastructure companies gain favor while software stocks face stress tests. Investors now focus on software earnings, hyperscaler capex discipline, and mega-round deal terms to determine who will collect AI's tolls.