Shares of Applied Digital plunged by 5.2% on Tuesday as a broad market rout took hold. The S&P 500 fell 2.1% and the Nasdaq Composite slid 2.4%, marking their worst sessions in months. Investors reacted to President Trump’s renewed threats to impose tariffs on several European nations should they continue to block a U.S. proposal for control over Greenland, prompting a shift out of risk assets and into traditional havens such as gold and silver.

Applied Digital’s capital structure amplifies its sensitivity to an economic slowdown. The company carries a substantial debt load to finance rapid expansion of its AI-focused data centers, with a gross margin of just 16.4% and a market capitalization of approximately $10 billion. In a risk-off environment, any contraction in demand for high-performance computing services could pressure cash flows and strain interest coverage ratios, increasing volatility in the stock’s valuation.

Despite the pullback, Applied Digital remains above its primary moving averages, with the MACD indicator holding above its signal line—signs of underlying bullish momentum. The relative strength index sits in neutral territory, indicating neither overbought nor oversold conditions. Technical traders will be monitoring the resistance zone around the $40 level: a clear breakout could reignite upside momentum, whereas failure to breach that threshold may trigger further consolidation.