HSBC downgrades Nvidia, capping record weekly value loss

A wave of Wall Street downgrades and a second straight day of chip-stock selling capped the worst week on record for Nvidia's ↘ 2.01% market value. The chipmaker lost $639.1 billion in market capitalization over the week, its largest weekly drop ever, Barron's News Corp ↗ 2.45% reported. Jensen Huang resigned as CEO on Thursday, Nov. 12, after reports of two extramarital affairs, one of them with a woman U.S. intelligence suspects of spying for China. Investors are now trying to work out what the company is worth without its founder, and whether the scandal will tighten export controls on chips sold to China.barrons.com

A string of downgrades

On Friday, HSBC ↗ 0.61% analyst Frank Lee cut Nvidia to hold from buy and lowered his price target to $170 from $365. "We believe the uncertainties will prevail until a permanent succession plan is laid out and the new CEO is able to demonstrate execution capabilities," Lee wrote, CNBC Comcast Corporation ↗ 1.45% reported. Earlier in the week, Truist, Evercore ISI, William Blair, Oppenheimer ↘ 0.48% and Bernstein had already downgraded the stock, CNBC noted.cnbc.com

Truist's William Stein lowered his rating to hold and cut his target to $174 from $346. He warned that the risk went beyond Huang's departure. "It's not just about ex-CEO Jensen Huang's affairs or his resignation, but also about the potential that NVDA's culture becomes impaired, and that the company may have shipped GPUs that became accessible to companies and government entities in China," he wrote, according to CNBC. JPMorgan ↗ 0.98% credit analyst Erica Spear wrote that "the export control implications could prove more consequential than the leadership change itself," CNBC reported.cnbc.com

Chip selloff spreads

The selling spread across semiconductors on Friday. Advanced Micro Devices ↘ 8.75% and Broadcom ↘ 4.76% led the Philadelphia Semiconductor Index lower, Reuters Thomson Reuters Corporation ↗ 0.05% reported. A Bloomberg gauge of large chipmakers fell 3.4% and the Nasdaq 100 lost 1.2%. Nvidia ended the week down 13%, its steepest weekly fall since April 2025, Bloomberg reported.fidelity.com+1

The S&P 500 ↘ 0.36% fell 0.4% and the Nasdaq Composite fell 0.9% on Friday, although both still finished the week higher, the Associated Press reported. Nvidia has now fallen for six weeks in a row, its longest losing streak since October 2012, Reuters said.fidelity.com+1

Earnings test ahead

Interim CEO Colette Kress, who remains Nvidia's chief financial officer, is set to lead the company's earnings report on Nov. 17. Nvidia is also facing scrutiny over whether U.S. export restrictions were circumvented in sales to Chinese companies, Bloomberg reported. After the selloff, the stock trades at 11 times expected earnings, compared with a five-year average of 33.6 times, Barron's noted.swissinfo.ch+1

"The thing to watch is not who is at the podium but whether the order book has changed," Brian Jacobsen of Annex Wealth Management told Bloomberg.swissinfo.ch