NEW YORK – The S&P 500 and the Nasdaq Composite indexes fell on Nov 12 as Nvidia CEO Jensen Huang’s exit unnerved the AI trade and higher oil prices prompted investors to retreat to the sidelines.
The AI heavyweight’s shares dropped 7.6% as investors fretted over the industry impact of Huang’s resignation from the company central to the AI boom, following reports of his involvement in a second extramarital affair.
Nvidia’s chief financial officer, Colette Kress, will take over as interim CEO.
“It leaves the company rudderless. He was so central to all their strategy, and it just highlights that there’s quite a void there,” said Kathleen Brooks, research director at XTB.
“It does throw the AI trade into a bit more confusion. You don’t have someone who was a cheerleader for AI in the same way that Jensen Huang has.”
AI stocks were also reeling after neocloud company Nebius said its 2026 revenue would come in at the low end of its previous forecast, pulling its shares down 17%. Peer CoreWeave dropped about 7%.
The Philadelphia SE Semiconductor index declined 1.3%, as chipmakers Intel, Marvell Technology and Micron fell between 2.8% and 4.2%.
Other data centre-related firms IREN, Applied Digital and Core Scientific fell between 3% and 5%.
The declines threatened to erase the gains on Nov 11, when strong results from CoreWeave helped AI stocks regain some footing.
However, shares of other Magnificent Seven firms advanced, with Amazon rising 2.3%, while Alphabet, Microsoft and Apple traded slightly higher.
Nvidia’s rivals Advanced Micro Devices and Broadcom were up 4.3% and 5.5%, respectively.
At 09.45am ET, the Dow Jones Industrial Average rose 35.53 points, or 0.07%, to 52,522.02, the S&P 500 lost 22.06 points, or 0.29%, to 7,597.32 and the Nasdaq Composite lost 141.55 points, or 0.56%, to 25,322.31.
The S&P 500 tech sector index fell 1.3%, overshadowing gains elsewhere on the benchmark. Six of 11 major sectors were in the positive territory.
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Inflation data awaited, oil rises
Investors are also gearing up for the release of the Producer Price Index on Nov 13, which could help shape inflation expectations after data earlier this week showed consumer prices rose more than expected in October.
A drop in oil prices so far in November has helped ease some concerns about price pressures, but investors remain wary of geopolitical risks in the Middle East.
Brent crude futures rose 0.8% on Nov 12, after US President Donald Trump said, “we don’t need a deal with Iran.”
Traders see a December rate hike by the Federal Reserve as a certainty, with about a 13% chance of an outsized 50-basis-point increase, according to the CME FedWatch tool.
“Energy effects will take longer to fade. Oil prices have remained near US$100 per barrel for much of the year, extending their contribution to inflation,” said Josh Hirt, senior US economist at Vanguard.
“But absent a renewed and sustained increase in prices, that contribution should remain limited.”
Separately, Michael Saylor’s Strategy fell 6.6% after index operator MSCI said it will remove the stock from its global indexes.
Declining issues outnumbered advancers by a 1.99-to-1 ratio on the NYSE, and by a 2.68-to-1 ratio on the Nasdaq.
The S&P 500 posted 16 new 52-week highs and one new low while the Nasdaq Composite recorded 27 new highs and 101 new lows. REUTERS
