Nvidia falls again as Citi, Wells Fargo cut targets

Wall Street recovered most of last week's losses on Monday, Nov. 9. The S&P 500 ↘ 0.84% rose 2.3%, its best day since April, and lower oil prices helped lift stocks across the market. Nvidia ↘ 5.70% was the main exception. Its shares fell 4.3% after its board opened an investigation into CEO Jensen Huang, the Associated Press reported.apnews.com

The Dow Jones Industrial Average gained 1,104 points, or 2.2%, to close at 52,389.75. The Nasdaq Composite climbed 2.7% to 25,253.14, and the S&P 500 finished at 7,549.94, just 3.4% below the record it set last month, according to AP. Brent crude fell 5.8% after President Donald Trump told CNN that renewed strikes on Iran were "highly unlikely" if negotiations made progress, AP reported.apnews.com

AI stocks rebound

Last week's sell-off was driven by fears that Democratic wins in the midterm elections could slow the construction of AI data centers. On Monday, much of that damage reversed. Advanced Micro Devices ↗ 2.70% jumped 13.3%, CoreWeave ↘ 2.39% rose 5.6%, and Constellation Energy ↘ 3.08% gained 10.5% after reporting better-than-expected results, per AP. The Philadelphia Semiconductor Index PHLX Semiconductor Index ↘ 1.18% rose about 7%, and Nvidia was the only stock in the index to fall, CNA reported.channelnewsasia.com+1

Stocks also rose abroad. Japan's Nikkei 225 climbed 2.3% and France's CAC 40 added 1.2%, while Seoul's Kospi slipped, AP noted. London's FTSE 100 gained 1% in what This is Money called a "fragile recovery."apnews.com+1

Nvidia's leadership questions

Nvidia's board started the investigation on Sunday. It came after Huang admitted an intimate relationship with Alice Huang, an executive at Nvidia customer Megaspeed whom U.S. officials reportedly concluded was a Chinese intelligence asset, according to CNBC. The board said it had "no reason to believe" that national security or company secrets were compromised, AP reported. At one point on Monday the stock was down nearly 9%. By the close, Nvidia had lost about $190 billion in market value, CNA reported. China's foreign ministry called the allegations "nothing but smears against China."cnbc.com+2

Trump said Monday that the FBI is looking into the matter and added, "I think he'll be in good shape," CNBC reported. Also on Monday, shareholders filed a proposed class action accusing Nvidia and Huang of hiding his ties to the suspected spy, according to Reuters via Yahoo Finance. On Tuesday, Citi and Wells Fargo lowered their price targets on the stock, 24/7 Wall St. reported.finance.yahoo.com+2

Analyst Dan Ives estimated that Wall Street sees an 85% chance Huang stays on as CEO. He expects the board's review to take four to six weeks and said it "will create a clear overhang on the stock until more news emerges," CNBC reported.cnbc.com