Tech stocks rebound after midterm rout, but Nvidia espionage allegations unsettle investors

Technology stocks experienced a rebound across Asian markets on Monday following substantial losses the previous week, driven by concerns over potential US AI regulation and the profitability of the AI boom. However, allegations of foreign espionage involving Nvidia's CEO, Jensen Huang, continued to unsettle investors. Chipmakers and other companies associated with the AI boom suffered significant losses in the days following the US midterm elections in which Democrats gained control of both houses of Congress.

The results indicated voter discontent over President Trump's policies, including Iran's war and tariffs, as well as backlash against extensive data center construction. The uncertainty surrounding Nvidia and potential investigations into Huang's alleged involvement in a foreign espionage plot added further strain to investor sentiment.

Analysts warned that these concerns could lead to congressional inquiries and increased scrutiny of chip exports to China, impacting Nvidia's market position and overall market sentiment.