Wall Street braces for Nvidia fallout as Huang scandal rocks AI stocks
Wall Street is bracing for further volatility on Friday after Jensen Huang’s dramatic departure from Nvidia sent shockwaves through global markets, wiping billions off the chipmaker’s value and raising fresh questions over the future of the AI boom. Nvidia shares closed more than four per cent lower on Thursday, having plunged as much as 14 [...]
Wall Street is anticipating a period of increased volatility following the abrupt resignation of Nvidia's CEO, Jensen Huang, on Thursday. The announcement sent shockwaves throughout global markets, causing Nvidia's stock to plummet by more than four percent and dragging down major indices such as the Nasdaq, S&P 500, and Dow Jones. Asian markets also experienced fluctuations, with Hong Kong's Hang Seng down 1.6 percent and South Korea's Kospi down one percent. London's FTSE 100 opened 0.2 percent lower.
The scandal surrounding Huang has intensified the scrutiny on AI stocks, with investors reassessing their positions. Nvidia rivals have gained as the market evaluates the impact of the leadership crisis on the AI boom. Advanced Micro Devices (AMD) and Broadcom both witnessed share price increases exceeding five percent, following a broader market reaction.
Jed Ellerbroek, a portfolio manager at Argent Capital Management, views Huang's departure as an opportunity for competitors, suggesting that the AI revolution is larger than any single company.
Despite the turmoil, analysts remain cautiously optimistic about Nvidia's immediate business prospects. Michael Hewson, an analyst at MCH Market Insights, believes that the company's operations will likely continue as usual. However, the pending quarterly earnings report on Tuesday will serve as the first major test of Nvidia's outlook under interim CEO Colette Kress.
Written by urgent.news from City AM's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
