The U.S. stock market absorbed big swings and Nvidia shares dropped following the resignation of Chief Executive Officer Jensen Huang.
The U.S. stock market erased nearly all of its early losses by the afternoon, absorbing heavy swings for both the dominant chipmaker and crude oil prices.
Wall Street showed signs of viewing the fallout for the broader artificial intelligence sector as limited, even as the face of the brand stepped down amid a board investigation into a relationship with a woman suspected of being a Chinese government agent, according to the Associated Press.
Nvidia Shares Drop as Investors Rotate to Competitors
- Nvidia shares dropped 14% at the opening bell before paring losses to 5.1% by Thursday afternoon, acting as the heaviest single weight on the S&P 500.
- Chief Financial Officer Colette Kress was named interim CEO by the Nvidia board, leaving open the question of how the company will operate without Huang.
- Competitors such as Broadcom (NASDAQ: AVGO) and Advanced Micro Devices (NASDAQ: AMD) gained 5.5% and 4.7% respectively, as investors rotated capital into alternative hardware providers.
S&P 500 Recovers After Nvidia Volatility
After dropping nearly 1% at the start of trading, the S&P 500 quickly recovered most of its deficit and traded only 0.2% lower by mid-afternoon. The Dow Jones Industrial Average remained mostly unchanged, while the Nasdaq composite fell 0.3% after bouncing back from an early drop of 1.6%, the Associated Press reported.
At the center of the volatility was Nvidia, whose stock price had set a record last month after surging 1,722% over four years. The equity sank 27% from that record peak through Wednesday over concerns regarding Huang’s tenure. On Thursday morning, the board announced Huang’s resignation and appointed CFO Colette Kress as interim CEO.
Selling pressure eased as analysts said that the company continues to sell AI chips at a rapid pace regardless of leadership changes.
“Nvidia's fate as one company is one thing, but this AI revolution is way bigger than that,” said Jed Ellerbroek, portfolio manager at Argent Capital Management.
“This is a golden opportunity for Amazon, for Google, for AMD, for Broadcom, for OpenAI and Anthropic, who are hiring chip experts to help them design their own chips,” said Jed Ellerbroek, portfolio manager at Argent Capital Management, as reported by CNBC.
Divergent Movements Across Artificial Intelligence Suppliers
Outside of Nvidia, supply chain partners and competitors experienced sharp divergence. CoreWeave, which buys Nvidia chips to rent out cloud access, dropped 7.3%, and Micron Technology sank 2.4%.
NVIDIA CEO Jensen Huang steps down, Colette Kress named interim CEO; shares tumble 📉 pic.twitter.com/fJKRaHSBrZ
Conversely, gains by rival chipmakers nearly offset Nvidia’s downward pull. GE Vernova, which supplies power to AI data centers, reversed an early 3% loss to climb 1.9% by afternoon trading.
| Company Ticker | Sector / Role | Intraday Stock Movement |
|---|---|---|
| Nvidia (NASDAQ: NVDA) | AI Hardware Leader | -5.1% (Recovered from -14%) |
| Broadcom (NASDAQ: AVGO) | Semiconductor Rival | +5.5% |
| Advanced Micro Devices (NASDAQ: AMD) | Semiconductor Rival | +4.7% |
| CoreWeave (NASDAQ: CRWV) | Cloud Infrastructure | -7.3% |
| Micron Technology (NASDAQ: MU) | Memory Hardware | -2.4% |
Rising Crude Prices Drive Treasury Yields Higher
Outside the technology sector, energy stocks found support from rising commodity prices. “We don't need a deal with Iran,” President Donald Trump said, after Marathon Petroleum climbed 3.4% and Exxon Mobil added 2.4%. A barrel of Brent crude oil rose 2.6% to $95.18 during afternoon trading.
The jump in crude prices renewed inflation anxiety across fixed-income markets. The yield on the 10-year Treasury climbed to 5.11%, up from 4.98% late Tuesday, as bond trading reopened following Veterans Day.
Higher borrowing costs continued to weigh on the broader domestic economy. Previously owned U.S. home sales in October recorded their slowest pace in more than 16 years due to persistent mortgage rates, though weekly unemployment benefit applications remained historically low.
Global Index Reactions
International markets mirrored the cautious sentiment. European indexes finished mixed following a weaker close across Asia. Hong Kong’s Hang Seng index fell 1.3%, marking one of the largest regional moves as global exchanges processed the leadership crisis at the center of the artificial intelligence boom.
Disclaimer: The information provided in this article is for educational and informational purposes only and does not constitute financial advice.
