US stocks ended a dramatic week higher, even as Nvidia sank about 13% after the resignation of founder Jensen Huang. Investors rotated into other chipmakers and broader markets. Next week: Nvidia’s results, and the Anthropic listing.
On paper, it was a terrible week for the AI trade. The world’s most important AI chipmaker lost its founder and chief executive in a scandal, and its shares tumbled.
Yet Wall Street ended the week higher.
The S&P 500 rose about 2.5% for the week, the Nasdaq Composite about 2.3% and the Dow about 2.1%. The Nasdaq notched its best week since August, CNBC reported.
Most of the gains came early. On Monday, stocks staged their biggest rally since April as investors bought the dip after the previous week’s AI sell-off. A strong quarterly report from AI cloud provider CoreWeave on Wednesday added fuel.
Friday was weaker. The S&P 500 fell 0.40% to 7,561.67, the Nasdaq 0.91% to 25,136.27, while the Dow edged up 0.10% to 52,347.55. Technology was the worst-performing sector, falling 1.7%.
Nvidia’s week from hell
Nvidia closed at $162.85 on Friday, down about 2%. That left it about 13% below where it stood on 6 November, before its board opened an investigation into Huang. His resignation on Thursday, after reports of two extramarital relationships, one involving a woman US officials suspect of spying for China, pushed the company’s market value below $4 trillion.
The scrutiny isn’t fading. Commerce Secretary Howard Lutnick has agreed to testify before the Senate on Nvidia’s chip sales, adding to pressure from Congress after Huang agreed to testify too. The search for Huang’s successor has barely begun: Nvidia’s board said it is still choosing a search firm and hasn’t formally approached any candidates.
The week also saw some rotation. Rather than abandoning AI, investors spread their bets across other chipmakers. Broadcom rose about 18% for the week. AMD jumped early in the week, though it fell nearly 9% on Friday as chip stocks sold off together.
That pattern suggests investors still believe in AI demand, but are less willing to concentrate it in one company whose leadership is in flux.
The road ahead
Nvidia’s results. Nvidia reports quarterly earnings on Tuesday, 17 November, its first without Huang in charge. Investors will look past the leadership drama to demand for its chips and its outlook.
Anthropic’s listing. The AI company behind the Claude models is expected to price its initial public offering next week. Reuters noted that the listing could test investors’ appetite for established AI companies, as money potentially shifts towards the newcomer.
Interest rates. US producer prices rose a little less than expected on the month in October, but annual producer inflation hit its highest since 2022. Markets still expect the Federal Reserve to raise rates in December.
The AI sell-off has been one reason foreign investors rotated into Indian shares this month. If Nvidia’s results calm nerves and AI stocks recover, some of that money could flow back to US technology. If the AI trade stays shaky, India could keep attracting rotation flows.
For investors, the lesson of the week is that markets can absorb a shock to one company, even the most important one, as long as the broader story holds. The next few days will show whether it does.
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