Nvidia falls 5.5% as Huang controversy and hot inflation hit stocks

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Nvidia falls 5.5% as Huang controversy and hot inflation hit stocks

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Nasdaq S&P 500 Nvidia

Nvidia fell 5.5% on Tuesday as CEO Jensen Huang's affair with an alleged Chinese spy weighed on the stock for a second straight session. Hotter-than-expected inflation data added to the pressure, and stock futures rose early Wednesday.

Nvidia pulled back 5.5% on Tuesday, as CEO Jensen Huang's affair with an alleged Chinese spy weighed on the stock for the second consecutive session. The chipmaker sat at the center of a broader market decline.

The S&P 500 and Nasdaq Composite shed 0.4% and 0.7%, respectively, while the Dow pulled back more than 150 points in regular trading.

Two-day slide cuts Nvidia market cap to lowest since March

The slide pulled Nvidia's market cap down to around $4.07 trillion, its lowest since late March.

Hot inflation firms up December rate hike bets

Equities also fell after the latest U.S. inflation data solidified expectations for a December Federal Reserve rate hike. The consumer price index rose 0.4% month over month in October, topping expectations.

Expectations for a quarter-point increase next month rose to about 90% after the release, per CME Group's FedWatch tool. However, BlackRock's Rick Rieder wrote that "hiking the Fed Funds policy rate in December is our and the market's base case".

Futures rebound on Wednesday

Stock futures rose early Wednesday. Dow futures gained 92 points, or 0.18%, S&P 500 futures climbed 0.6%, and Nasdaq-100 futures advanced 1.43%.

Traders will now watch the AI trade after CoreWeave reported third-quarter revenue that beat analyst expectations.

Source: CNBC

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