Wall Street braces for Nvidia fallout as Huang scandal rocks AI stocks

Nvidia shares fell sharply after chief executive Jensen Huang stepped down following 33 years at the company, unsettling investors and reviving questions about the AI boom. The leadership shock also weighed on major US indices, while rivals’ shares rose as investors considered whether they could gain from the change.

Nvidia closed more than 4 per cent lower on Thursday after falling as much as 14 per cent during the session. Reports of three alleged affairs, including one involving a woman suspected by US intelligence officials of spying for China, preceded Huang’s departure; he has acknowledged one relationship but has not confirmed the other two reports. AMD and Broadcom each gained more than 5 per cent, and Nvidia’s quarterly results, due Tuesday, will be the first major test of its outlook under interim chief executive Colette Kress.