Nasdaq climbs 3.4% as Nvidia falls 9% on Jensen Huang affair disclosure
Wall Street opened the week with a rebound, but the chipmaker at the centre of the AI trade sat it out. The Nasdaq Composite climbed 3.4% at its intraday high, the S&P 500 added 2% and the Dow Jones Industrial Average jumped 844 points, or 1.65%, as dip-buyers moved in after the S&P 500's biggest weekly loss since April 2025.
Nvidia was the heaviest drag among chip stocks, falling 9% to a seven-month low of $170 a share after chief executive Jensen Huang admitted to an affair with a woman identified in a series of reports as a suspected Chinese spy. The disclosure weighed on Nasdaq 100 futures at the Asian open before the contracts reversed those losses. The weakness did not spread to peers: Broadcom and Advanced Micro Devices each rose 5%, ON Semiconductor gained 3%, and the rest of the Magnificent Seven traded higher, with Amazon up 5% and Tesla and Alphabet each climbing more than 3%.
The sell-off that preceded Monday's bounce was sharp. $2.3 trillion was wiped off the value of the Nasdaq 100 on Thursday alone, according to Token Times, amid concerns that the Democratic Party could crack down on the AI industry after sweeping gains in Congress. Japanese and Taiwanese equities slipped into bear markets last week, and South Korea's two chipmaking giants, Samsung Electronics and SK Hynix, tumbled more than 16%.
Crude offered support. Brent fell 4% towards $94 a barrel, extending last week's 16% decline, after an unconfirmed report that Iran had made concessions over the Strait of Hormuz. US President Donald Trump said on Sunday it was "highly unlikely" he would order further strikes on Tehran if negotiations showed progress, though Secretary of State Marco Rubio played down the chances of a breakthrough.
The AI growth story faces fresh tests this week, with earnings due from CoreWeave, Cisco Systems and Applied Materials. US inflation data on Tuesday will sharpen the Federal Reserve's rate outlook, with traders assigning an almost 80% probability of a hike by year-end. The Labor Department reported on Friday that employers added 165,000 jobs in October, more than double the 65,000 economists expected and far above the 48,000 monthly average of the previous 12 months.
