Global technology stocks staged a partial recovery on Monday after last week’s losses, but Nvidia shares fell sharply amid uncertainty surrounding an investigation involving its chief executive, Jensen Huang.
The technology-heavy Nasdaq Composite rose 0.9 per cent shortly after Wall Street opened, while the Philadelphia Semiconductor Index, which tracks major chipmakers and artificial intelligence-related companies, gained 1.9 per cent.
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However, Nvidia shares dropped more than 8 per cent as investors reacted to reports that the company’s board would investigate whether Huang had been targeted in an alleged foreign espionage plot.
The development followed reports of an alleged relationship between Huang and a Chinese executive linked to a Singapore-based data centre company.
According to The New York Times, US intelligence officials had concluded that the executive, Alice Huang, also known as Huang Le, had been funnelling information to Beijing.
The report said she had developed a close relationship with the Nvidia chief executive, although the two are not related.
Huang, 63, reportedly acknowledged being unfaithful to his wife in a message to company employees released to the media on Sunday.
He also apologised to his family and staff.
The allegations have introduced uncertainty around Nvidia, one of the world’s most valuable companies and a major supplier of chips used to train and operate artificial intelligence models.
Briefing.com analyst Patrick O’Hare said investors appeared to be treating Nvidia’s decline as a company-specific issue rather than a broader threat to the technology sector.
He said the wider market recovery reflected investors’ willingness to buy shares following last week’s losses, particularly in companies linked to artificial intelligence.
Investment analyst Dan Ives of Yorkville Ives said the controversy could trigger congressional inquiries and create uncertainty around Nvidia’s shares.
He also warned that the situation could increase scrutiny of the company’s global strategy, particularly its sales of advanced chips to China.
China, however, rejected allegations that it had spied on Huang, describing the claims as baseless.
The wider technology sector had come under pressure following last Tuesday’s US midterm elections, in which Democrats won both chambers of Congress.
The results fuelled speculation that lawmakers could pursue tighter regulation of major technology companies.
Despite the pressure on Nvidia, other major US indices recorded gains at the opening of trading.
The Dow Jones Industrial Average rose 1.1 per cent to 51,858.65 points, while the S&P 500 gained 0.8 per cent to 7,438.80.
In Europe, London’s FTSE 100 advanced 0.7 per cent, Paris’s CAC 40 gained 1.1 per cent and Frankfurt’s DAX rose 1.2 per cent.
Asian markets recorded mixed performances, with Japan’s Nikkei 225 rising 2.3 per cent, while South Korea’s Kospi declined 0.8 per cent and Hong Kong’s Hang Seng Index slipped 0.1 per cent.
Meanwhile, oil prices fell sharply amid hopes that diplomatic negotiations could help bring an end to the US-Iran war.
Brent crude declined 5.5 per cent to $92.90 per barrel, while US West Texas Intermediate crude fell 4.9 per cent to $86.34.
The dollar also weakened against major currencies, while the euro and pound recorded gains against the US currency.
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The market movements came as investors assessed geopolitical developments, corporate uncertainty and the outlook for the technology sector.
Peculiar Adirika is a journalist and contributor to Freelanews.com, covering news, business, and public affairs.
