Chip stocks are bouncing back Monday, but the rally comes with a pretty big catch: Nvidia, the company at the center of the AI trade, is getting hammered before Wall Street even opens.
Investors are piling into semiconductor names across Taiwan, South Korea and Europe after last week’s selloff, while a board investigation into Nvidia CEO Jensen Huang adds another headache for American traders.
So this is hardly one of those days when every tech stock heads in the same direction.
The buying follows a rough stretch for AI stocks. Democrats won control of Congress , and investors started questioning whether Washington could put new limits on the huge data centers being built to run artificial intelligence.
That concern helped drive Thursday’s painful selloff. Friday brought some bargain hunting, and Monday’s Asian session showed buyers weren’t finished. There’s still demand for the companies making chips and the machines used to produce them, even if investors are suddenly a lot more nervous about the costs of expanding AI infrastructure.
Taiwan’s chip giants lead the rebound
Taiwan’s Weighted Index surged as much as 6.7% before ending Monday up 4.94% at 41,664.7. That was its biggest one-day gain since July 31. The rally had two clear drivers: Taiwan Semiconductor Manufacturing Company (NYSE: TSM), which climbed more than 6%, and electronics manufacturer Hon Hai Precision Industry, better known as Foxconn, which jumped over 8%.
Those gains matter because TSMC manufactures advanced processors used by major chip designers, while Foxconn builds electronics and server hardware. When investors start buying both, they’re betting that demand across the technology supply chain can survive the political noise. It doesn’t mean Washington’s data center debate has disappeared. It means traders are willing to take another look at companies they dumped last week.
However, South Korea also had some winners. Samsung Electronics (KRX: 005930) advanced by 2.7%, while SK Hynix (KRX: 000660) increased by 4.77%. Both companies provide products to Nvidia, where memory chips are essential for AI computing.
Europe joined in, too. The Stoxx 600 technology index added 1.3% in early trading, and Dutch semiconductor equipment company ASML (NASDAQ: ASML) gained 1.7%. Be Semiconductor Industries and ASM International also advanced. They make equipment used in chip production, so investors don’t have to bet on one AI company to get exposure to the industry.
The mood wasn’t entirely new. On Friday, the Nasdaq Composite rose 1.09% to 24,579.42, while the S&P 500 gained 0.31% to 7,376.86. But the Dow Jones Industrial Average dropped 237.33 points, or 0.46%, to end at 51,285.73.
Come Monday morning, futures appeared much healthier, with Dow futures gaining 0.76%, Nasdaq 100 futures gaining around 0.5%, and S&P 500 futures gaining 0.34%.
Nvidia’s scandal leaves U.S. chip investors uneasy
Here’s the awkward part of Monday’s rebound. Nvidia (NASDAQ: NVDA) was down more than 5% in premarket trading, thanks to the disaster of Jensen’s affair with a Chinese spy named Alice Huang.
As Cryptopolitan previously reported , U.S. intelligence agencies were already concerned Alice, who is associated with cloud company and Nvidia customer Megaspeed, might have passed information to Beijing. Those are allegations, not proven findings.
Jensen told Nvidia employees he’d had an affair with Alice and apologized. An Nvidia spokesperson said he intended to continue running the company “without interruption.”
Other American chip names weren’t escaping the nerves. Intel (NASDAQ: INTC), Marvell Technology (NASDAQ: MRVL), Qualcomm (NASDAQ: QCOM) and Arm (NASDAQ: ARM) each lost more than 1% early in the premarket session. A proxy for Nvidia shares traded on Hyperliquid had also dropped 2% over the preceding 24 hours.
In a semiconductor market snapshot from Yahoo Finance, Broadcom (NASDAQ: AVGO) was at $1.402 trillion valuation, SK Hynix valued at around $898 billion, Micron (NASDAQ: MU) at $781 billion, and Advanced Micro Devices (NASDAQ: AMD) at $736 billion. The others were Intel at $299 billion, Texas Instruments (NASDAQ: TXN) at $254 billion, Qualcomm at $177 billion, Analog Devices (NASDAQ: ADI) at $176 billion, and Marvell at $127 billion.
Here is the rest of the earnings schedule featuring CoreWeave (NASDAQ: CRWV), Cisco (NASDAQ: CSCO), and Applied Materials (NASDAQ: AMAT). There will be focus on signs of continued investments in AI infrastructure. Inflation will be in the spotlight with consumer price index to be reported on Tuesday and producer price index on Friday.
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