Market Overview
Nvidia fell 2.01% on Friday following CEO Jensen Huang’s resignation and an HSBC downgrade, extending its weekly loss to 12.75% as chip stocks came under pressure. Investors assessed how the leadership change could affect Nvidia’s AI financing commitments and succession plans. October’s US Producer Price Index (PPI) rose less than expected on the month, but the report did little to change expectations of a Federal Reserve rate hike in December. Despite Friday’s technology sell-off, the S&P 500, Nasdaq and Dow recorded their strongest weekly gains since early August.
Markets
US equities finished largely mixed on Friday. The Nasdaq Composite declined 0.91% to 25,136.27, while the S&P 500 fell 0.40% to 7,561.67, primarily due to weakness in chipmakers. Bucking the trend, the Dow Jones Industrial Average gained 0.10% to 52,347.55. For the week, the S&P 500 recorded a 2.51% increase, the Nasdaq Composite advanced 2.27%, and the Dow rose 2.07%, marking their strongest weekly performances since early August.
US Treasury yields moved higher, with the 10-year Treasury yield up 5.10 basis points to 5.154% and the 30-year Treasury yield rising 4.80 basis points to 5.481%. The US Dollar Index increased 0.24% to 103.42. Oil prices ended higher Friday: Brent crude rose 0.35% to US$96.16 per barrel and WTI crude gained 0.24% to US$88.95 per barrel. Both contracts nevertheless recorded weekly declines.
What Drove Markets
The artificial intelligence (AI) sector, and particularly chipmakers, faced significant headwinds after Nvidia’s founder and CEO Jensen Huang stepped down. His resignation followed reports of extramarital affairs, including a relationship with a woman US intelligence officials reportedly suspected of spying for China. Nvidia’s shares fell 2.01% on Friday, extending a multi-day decline to a 12.75% weekly drop, its worst weekly performance since April 2025. HSBC downgraded Nvidia to ‘hold,’ citing expectations for the stock to languish until a permanent succession plan is established.
Interim CEO Colette Kress, Nvidia’s CFO, is currently leading the company. Goldman Sachs analyst James Schneider noted that Huang’s departure could complicate new multi-party investments among ecosystem partners. Thomas Martin of Globalt Investments anticipates the CEO search will “take a lot of time,” creating further uncertainty for the company’s financing arrangements and relationships. While Baird’s Ross Mayfield suggested much pain has been priced into Nvidia’s stock, he still expects volatility and a rotation by investors into non-AI market segments. The company also faces regulatory scrutiny over potential circumvention of US export restrictions for sales to Chinese firms, a situation highlighting broader geopolitical sensitivities surrounding technology.
Meanwhile, October’s US Producer Price Index (PPI) offered a mixed picture. The index rose 0.3% month-over-month, below economists’ expectations of 0.4%, but its annual advance of 6.5% marked the biggest gain since November 2022. Core PPI, excluding volatile food and energy components, advanced 0.3% month-over-month and 5% year-over-year, matching estimates. Despite some signs of improvement, Chris Zaccarelli, chief investment officer at Northlight Asset Management, stated that the PPI data is unlikely to alter the Federal Reserve’s approach in December, given previous Consumer Price Index (CPI) figures were already outside their comfort zone. Markets are largely pricing in a Fed rate hike next month, with some analysts even considering a 50 basis point increase.
Stocks to Watch
NVIDIA (NVDA): The chipmaker’s shares fell 2.01% on Friday, extending a multi-day decline and contributing to a 12.75% weekly drop, following the resignation of CEO Jensen Huang and an HSBC downgrade. The leadership crisis and future financing uncertainty will be closely watched.
Advanced Micro Devices (AMD) & Broadcom (AVGO): Shares of chipmakers AMD declined 8.75% and Broadcom fell 4.76% on Friday. Their declines added to Friday’s broader semiconductor sell-off as investors assessed the fallout from Nvidia’s leadership change.
CoreWeave (CRWV) & Dell Technologies (DELL): Neocloud provider CoreWeave’s shares dropped 6.13%, while AI server maker Dell Technologies fell 7.18%. The losses came as investors weighed the potential impact of Nvidia’s leadership change on financing arrangements and partnerships across the AI infrastructure sector.
VanEck Semiconductor ETF (SMH): The fund, which tracks an index of major US-listed semiconductor companies, declined 2.99% on Friday amid a broad sell-off in chip stocks.
SK Hynix (000660.KS) & Samsung Electronics (005930.KS): South Korean chipmaker SK Hynix fell 3.03%, and Samsung Electronics declined 0.96% on Friday. Both are key players in the global tech ecosystem as suppliers and consumers of AI hardware, making their performance relevant to the broader AI sector developments.
TSMC (2330.TW) & Tokyo Electron (8035.T): Taiwan’s leading chip manufacturer TSMC edged up 0.43%, while Japan’s top semiconductor equipment maker Tokyo Electron rose 1.69%. The gains contrasted with Friday’s declines among major US chipmakers.
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