AI Stocks Rebound Amid Jensen Huang Scandal and Jobs Data

Key Points

US AI stocks rallied sharply as Nasdaq 100 surged 3.4% amid post-election volatility.
Strong October jobs data raised December rate hike odds to 76.8 percent per CME data.
Nvidia underperformed rivals due to CEO Jensen Huang's personal conduct scandal revelations.
Major banks urged buying the dip, citing oversold conditions and long-term AI growth prospects.

Editorial Deep Dive & Context

US equity markets staged a significant recovery in artificial intelligence-linked equities after a volatile period driven by Democratic midterm election victories and corporate governance controversies. The Nasdaq 100 surged 3.4%, marking its best daily performance since late March, while the S&P 500 gained 0.3%.

Key beneficiaries included Advanced Micro Devices, which rose 13.3%, and Broadcom, up 8.8%, as investors rotated away from Nvidia amidst uncertainty surrounding CEO Jensen Huang’s personal conduct revelations. The rally faced immediate headwinds from robust October employment data, which added 165,000 jobs and lowered unemployment to 4.1%.

This strong labor report pushed US Treasury yields higher and increased the probability of a December Federal Reserve interest rate hike to 76.8%, according to CME Group FedWatch tools. Consequently, the initial buying momentum was curtailed, leaving the S&P 500 down roughly 2.7% for the week despite the intraday bounce. Wall Street analysts largely characterized the recent sell-off as an overreaction to political shifts and temporary financing concerns for neocloud providers. Major institutions including Goldman Sachs, Morgan Stanley, and JPMorgan urged investors to view the dip as a buying opportunity, arguing that AI infrastructure investment remains a primary driver of GDP growth.