Huang out: Wall Street digests Nvidia shake-up

Nvidia shares tumbled as chief executive Jensen Huang resigned in the fallout from his separate affairs with an alleged Chinese spy and one of his executive team, with investors moving into the likes of Broadcom and Advanced Micro Devices and helping keep Wall Street in mildly positive territory.

Meanwhile, Meta Platforms declined after a report that the social media giant and ByteDance’s TikTok have made a dozen settlements with teens as Big Tech firms brace for thousands of claims that their platforms are designed with addictive features that hook and harm children.

Oil prices rose as US President Donald Trump said he wants vice president JD Vance to focus on crime in US cities rather than press for peace with Iran.

And ASX futures are pointing to a soft start to the day in Australia, with reports that BHP plans to overhaul its Australian iron ore business to cut costs, while New Zealand prepares for the BNZ-BusinessNZ monthly manufacturing activity gauge and Heartland Group Holdings’ annual meeting.

Change is swift

Nvidia shares dropped as much as 14% and were down 5% in late trading after CEO Huang announced his resignation amid mounting pressure over his extramarital affairs. Chief financial officer Colette Kress was appointed interim chief while the board seeks a permanent replacement, and Harvey Jones was appointed the chipmaker’s first chair.

“The uncertainty surrounding the leadership change has added to selling pressure, with Nvidia shares now down approximately 27% over the past four weeks,” Moomoo market strategy consultant Greg Boland said in a note.

Broadcom and AMD were beneficiaries of Nvidia’s weakness, as were some of the major tech companies, with Alphabet, Microsoft and Amazon among the day’s gainers. Nvidia’s suppliers including Sandisk and Micron Technology and cloud computing firms such as CoreWeave and Oracle all declined.

Nebius Group tumbled 16% after the cloud computing firm cut its annual earnings outlook over delays to securing third-party computing capacity.

The Nasdaq Composite was marginally up in late trading, with the S&P 500 gaining 0.1% and the Dow Jones Industrial Average rising 0.3%, with Alphabet, Chevron Corp and Johnson & Johnson leading the blue-chip index higher. `

Teen titans

Meta slipped 0.7% in late trading after Bloomberg reported the social media giant and TikTok had made a dozen confidential settlements with teenagers over claims the platforms hurt their mental health. The settlements come as social media companies face about 9,800 personal injury cases.

European markets were stronger, with the UK’s FTSE 100 and France’s CAC 40 both up 0.3%, while Germany’s DAX advanced 0.4%.

Brent crude oil futures rose 1.9% to US$94.53 a barrel after US President Trump said he’d pulled vice president Vance from potential peace talks with Iran, saying his deputy’s time was better spent investigating crime in US cities and that the White House didn’t need peace with the Islamic Republic.

Meanwhile, US National Association of Realtors data showed annual existing home sales dropped 5.5% in October, a bigger decline than the 3.8% predicted by economists and the lowest level since 2010.

Australian futures are pointing to a 0.3% decline for the resources-heavy S&P/ASX 200 index when trading opens across the Tasman. Gold futures fell 3% to US$3,881 an ounce at 7am.

Bloomberg reported mining giant BHP planned to restructure its Australian iron ore business as part of a wider cost-cutting initiative.

The kiwi dollar traded at 55.44 US cents at 7am in Auckland from 55.57 cents yesterday, and rose to 81.47 Australian cents from 81.17 cents.

Local data today include the BNZ-BusinessNZ performance of manufacturing index, with industrial activity tracking above average in recent months. Heartland holds its annual meeting in Auckland today.

Reporting by Paul McBeth. Image from Official White House Photo by Joyce N. Boghosian on RawPixel