Nvidia stock slides on CEO probe while Wall Street rallies on without it
For 3 years, Nvidia has been engine of US stock market’s rise; current probe into CEO Huang has investors asking what happens if the engine stalls
On the Monday after Nvidia’s board announced an independent investigation into CEO Jensen Huang, the stock fell as much as 8 per cent before recovering to about 4 per cent below Friday’s close.
The board was looking into allegations that Huang had been targeted by a foreign intelligence operation involving a woman suspected of working for China. Huang also acknowledged in a message to employees that he had been unfaithful to his wife and apologised. The broader market barely noticed: the S&P 500 was up 1.9 per cent while Nvidia slid.
Also read: Who is Alice Huang, Chinese woman accused of honey-trapping Nvidia CEO Jensen Huang?
That divergence is new. For three years, Nvidia and the market have mostly moved together.
The story starts in late 2022, when ChatGPT turned AI from a research topic into a spending race. Every major tech company needed Nvidia’s GPUs to train and run its models. Revenue exploded, and the market cap crossed USD 1 trillion in 2023. The S&P 500’s rebound that year leaned heavily on a handful of AI-linked giants, with Nvidia at the front.
Nvidia's milestones
Then came the milestones. USD 2 trillion in early 2024, USD 3 trillion that summer, USD 4 trillion in mid-2025. By the time it hit USD 5 trillion, the stock made up 8.5 per cent of the S&P 500, more than the bottom 240 companies combined. Index funds and retirement accounts across America were now heavily exposed to one company’s earnings.
That concentration cuts both ways. In January 2025, the DeepSeek scare, a Chinese model that seemed to need far less computing power, erased roughly USD 590 billion of Nvidia’s value in a day, the largest single-day loss for any company on record.
Third-quarter results
The decline since then has been steadier. One report says market cap closed at USD 4.31 trillion on November 9, down from about USD 5.88 trillion at its 52-week high, reflecting concerns about the sustainability of AI spending. The investigation is landing on a stock already under pressure, and analysts have warned that the bigger risk is the US government imposing much tougher restrictions on chip sales to China. Others doubt it will cost Huang his job. Analysts are sceptical the controversy will lead him to step down, and US President Donald Trump has defended him.
The next test is close. Nvidia reports fiscal third-quarter results on November 17. The numbers will show whether AI demand is still strong. The investigation will show whether the market can trust the man who has become the face of that demand. After three years of lifting the market, Nvidia now has to prove it can carry it without wobbling.