Stock market today: Nasdaq rallies despite Nvidia stock slide, Dow and S&P 500 rise as AI stocks rebound

US stocks rose on Monday as the AI trade remained in focus ahead of a busy week of earnings and inflation data.

The Dow Jones Industrial Average (^DJI) rose 1.7%, while the S&P 500 (^GSPC) gained 2.1%. The Nasdaq Composite (^IXIC) climbed 2.6% after all three indexes posted losses last week.

All eyes were on the artificial intelligence trade following a volatile post-election shake-up in markets and the revelation that Nvidia’s (NVDA) board is opening an investigation into CEO Jensen Huang over his affair.

Several news outlets reported last week that the US believes Huang had a romantic relationship with Alice Huang, a Chinese businesswoman who is alleged to have been recruited to spy for China’s intelligence agency. In a memo to employees obtained by the FT, Huang admitted to marital infidelity, stating, “I was unfaithful to my wife. My actions hurt her and our children. There is no excuse for what I did. I am deeply sorry.”

52,324.86 +1,039.13 (+2.03%)

As of 12:10:03 PM EST. Market Open.

^DJI ^GSPC ^IXIC

Nvidia stock fell as much as 8% Monday, before selling eased. Broader stock indexes appeared to shrug off the news as they continue to recover from a bruising sell-off last Thursday.

Last week’s slide in energy prices continued Monday with Brent Crude Futures (BZ=F) hovering at $95 per barrel.

The biggest swell of third quarter earnings results is in the books, with just a few more weeks in the reporting season. On Monday, Hims and Hers (HIMS), Rocket Lab (RKLB), and Monday.com (MNDY) are among the companies sharing earnings.

The week starts off with light economic data, with wholesale trade data serving as the primary report.

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Thanksgiving gas is on track for a record, even after a six-week slide

Gas prices just fell for a sixth straight week but Thanksgiving drivers are still on track to pay more than ever, Yahoo Finance’s Jared Blikre reports:

Regular gas averaged $4.01 a gallon on Monday, according to AAA. That’s down about 10% from its latest peak of nearly $4.48 in late September, based on US Energy Information Administration data.

Wholesale prices have fallen about twice as fast. Gasoline futures (RB=F) slid about 21% from Sept. 18 through Friday’s close, as oil (CL=F) dropped about 20% from its April high.

Pump prices have typically run about $1 per gallon above futures prices. Based on Friday’s close, that points to roughly $3.70 to $3.80 a gallon, or another 20 to 30 cents of relief, by Yahoo Finance calculations.

Tech stocks rally, led by chip names

Nvidia (NVDA) stock may be down, but the rest of the market is broadly having an up day.

Tech stocks and industrial stocks led a comeback on Monday following a tumultuous week that saw the three major averages decline.

Chip-related stocks, including AMD (AMD), Micron (MU), and ASML (ASML), surged. The rest of the “Magnificent Seven” stocks, excluding Nvidia, gained. Tesla (TSLA) led that group, up 5% in morning trading.

US Stocks open higher as Wall Street looks for AI rebound

US stocks opened higher Monday as Wall Street looked to rebound from last week’s sharp sell-off, while investors weighed fresh uncertainty surrounding AI giant Nvidia (NVDA).

The Dow Jones Industrial Average (^DJI) rose 1%, while the S&P 500 (^GSPC) gained 0.9%. The tech-heavy Nasdaq Composite (^IXIC) rose 0.8%.

52,324.86 +1,039.13 (+2.03%)

As of 12:10:03 PM EST. Market Open.

^DJI ^GSPC ^IXIC

The gains followed a volatile post-election week that saw investors dump AI and chip stocks, sending the Nasdaq into correction territory before a partial recovery Friday.

Nvidia shares fell 6% after reports of a board investigation involving CEO Jensen Huang added to uncertainty surrounding the chipmaker.

Meanwhile, investors are looking ahead to fresh inflation data this week for clues about the Federal Reserve’s next move on interest rates. Oil prices continued to slide Monday with Brent Crude Futures (BZ=F) hovering below $94 per barrel.

Nvidia stock sinks 5% as chipmaker investigates CEO Huang

Nvidia (NVDA) stock fell more than 5% before the bell on Monday after the chipmaker’s board announced it would investigate the relationship between CEO Jensen Huang and a woman whom the intelligence community believes could be a Chinese Spy.

In a Sunday memo to employees, Nvidia CEO Jensen Huang admitted to an extramarital affair, apologizing to his family and staff while pledging full cooperation with an independent board review. Wall Street analysts quickly flagged the heightened ‘key-person risk’ for the world’s leading AI chipmaker.

A look across the semiconductor sector showed the risk damage was largely contained to Nvidia.

Alphabet announces 2 new chips as competition with Nvidia heats up

Alphabet (GOOG, GOOGL) announced two new AI chips on Monday aimed at challenging Nvidia’s (NVDA) dominance and adapting to the new era of AI agents.

Google stock rose nearly 3% in premarket trading. The Big Tech giant unveiled two versions of its bespoke semiconductors, called tensor processing units, or TPUs, according to Bloomberg.

Google chip chief Amin Vahdat told Bloomberg that the company configured its 8tx and 8i Max TPUs to complete tasks customers requested, such as handling confidential information and running AI applications that require long-context windows.

177.48 -9.16 (-4.91%)

As of 12:10:03 PM EST. Market Open.

NVDA GOOGL

Jensen Huang just handed Wall Street its first $4.5 trillion CEO scandal

Wall Street has priced plenty of CEO scandals. It has never priced one at a company worth $4.5 trillion that makes up nearly 7% of the S&P 500 (^GSPC).

Nvidia (NVDA) CEO Jensen Huang admitted in a Nov. 8 memo to employees to an affair with Alice Huang, whom US intelligence officials believe worked for China’s Ministry of State Security. “I was unfaithful to my wife,” he wrote. The board has opened an independent investigation.

The scale is hard to overstate. At Friday’s close, Nvidia was worth about four times the nine biggest companies ever hit by CEO personal-conduct scandals combined, by Yahoo Finance calculations. The largest, Intel (INTC), was worth $249 billion when Brian Krzanich resigned in 2018 over a past consensual relationship with an employee. Nvidia is about 18 times that.

This is key-person risk — the danger that a company’s value rests on one person — at its most extreme. Huang co-founded Nvidia in 1993 and has run it ever since, with no named successor.

Adjust for a bigger stock market, and the gap narrows but doesn’t close. No earlier scandal-hit company made up more than about 1% of the S&P 500, a mark only Intel in 2018 and HP (HPQ) in 2010 reached. Nvidia is about seven times that.

2 big AI narratives keep wrestling with each other for control of the market

Yahoo Finance’s Ethan Wolff-Mann writes in today’s Morning Brief newsletter:

What’s more important: the chip and AI infrastructure trade or the companies that actually provide AI?

As we wrote in the Morning Brief on Friday, “A data center slowdown is bad for the stock market’s AI engine,” and “A data center slowdown is good for Big Tech’s profit machine.”

Can Google (GOOG, GOOGL), Microsoft (MSFT), and Amazon (AMZN) deliver AI at least some productivity and tools to clients with the compute they have — and make a lot of money doing so, flipping the switch from growth and scale to monetization?

Maybe! Those companies are healthily in the green since the election, doing just fine amid the broader sell-off. And while Tesla (TSLA) has sold off, SpaceX (SPCX) is mostly doing fine.

As DataTrek’s Nicholas Colas wrote on Thursday, you need to look at the entire week, not just the bloody Thursday, to see the bigger picture (small as that is). And it’s pretty clear that this may be reflected in the broad indexes, but it’s mostly about chips.

“As for what the market is ‘saying’ over the last 2 days, we believe the moves are AI-centric, not augurs of a looming recession,” Colas wrote, also noting that Google and Co. are doing fine.

Nvidia’s board launches investigation into CEO Jensen Huang’s affair with an alleged Chinese spy

Yahoo Finance’s Ines Ferré and Daniel Howley report:

Nvidia’s (NVDA) board is launching an independent investigation into reports that a woman CEO Jensen Huang was having an affair with was allegedly spying on him for the Chinese government.

In an email to employees Sunday, Huang admitted to having an extramarital affair.

… The revelations come after reports of ties between Huang and a woman believed to be passing information to the Chinese government.

Last month, the New York Times reported the US intelligence service believed a Chinese national named Alice Huang, a former leader at Megaspeed, an Nvidia chip customer, and someone with a well-documented relationship with Huang himself, may have acted as an intelligence asset, sharing information with the ruling party in Beijing.

Yorkville Ives partner and senior managing director Dan Ives wrote in a note to investors on Sunday that the investigation is a “black eye” for Huang and will likely spark multiple congressional investigations.

“The key question investors will be asking is: Will Jensen remain CEO of Nvidia?…. The investigation will be key, and we would expect Jensen to continue in his role as CEO with no interruption in the near-term,” Ives wrote.

Good morning. Here’s what’s happening today.

Economic data: New York Fed’s Consumer Inflation Expectations for October (previous 3.9%), Wholesale Inventories for September

Earnings calendar: Constellation Energy (CEG), KKR (KKR), Barrick Mining (B), Occidental Petroleum (OXY), Skydance (SKYD), Take-Two Interactive Software (TTWO), NRG Energy (NRG), Kaspi.kz (KSPI), Paramount Skydance (PSKY), Praxis Precision Medicines (PRAX), Sanmina (SANM), Clearway Energy (CWEN), Qualys (QLYS), H&R Block (HRB), Ionis Pharmaceuticals (IONS), Casella Waste Systems (CWST), The Trade Desk (TTD), Hims & Hers Health (HIMS), NexGen Energy (NXE), monday.com (MNDY), Archer Aviation (ACHR), Via Transportation (VIA), USA Rare Earth (USAR), Plug Power (PLUG), Lucid Group (LCID), Trump Media & Technology Group (DJT)