Monday saw a tiny recovery from last week’s tech-led meltdown as global markets rose from six-month lows, but a dramatic decline in AI bellwether Nvidia was already emerging as a new test of sentiment. After an internal inquiry into whether CEO Jensen Huang had been targeted by a foreign intelligence operation raised doubts about his future at the AI chipmaker, Nvidia shares dropped slightly more than 4% in pre-market trade. As efforts to terminate the Iran war pick up steam after last week’s U.S. midterm elections, oil prices dropped more than 3%. President Donald Trump is scheduled to meet with the prime minister of important mediator Qatar on Monday.
US market futures bounced back from early declines, which is encouraging for the opening of Wall Street. Following Credit Agricole’s proposal to merge its Italian business with Banco BPM, creating Italy’s third-largest bank, European equities surged along with bank stocks. Sentiment was bolstered by the decline in oil prices, and Asian stocks also recovered as investors were drawn in by last week’s massive selloff. Widespread Democratic victories in the US midterm elections have heightened concerns about more regulation of AI and data centers, and the collapse of the AI trade with increasing interest rates has put pressure on global stocks in recent weeks.
With the recent test of investor sentiment being the selloff in Nvidia shares, analysts indicated the outlook remained cautious.According to Neil Wilson, UK investor strategist at Saxo, “markets are currently attempting to determine what this means for arguably the most important company in the world.”What will happen to Nvidia if Huang is compelled to leave? Huang is somewhat indispensable for US leadership in AI, as others have noted. After falling 4.6% the previous week, MSCI’s broadest index of Asia-Pacific stocks outside of Japan increased by 1.25%. After experiencing its greatest weekly decline in 20 years last week, Taiwan’s benchmark increased by about 5%.
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