Key Points

• Despite a rebound in the broader AI stocks, NVIDIA's stock price still tumbled significantly.
• Amazon rises 5.5%, Microsoft and Alphabet also see gains
• Jensen Huang-related investigations add uncertainty ahead of NVIDIA's financial report

During trading on Monday morning, NVIDIA's stock price fell by more than 6%, while Amazon, Microsoft, and Alphabet saw increases, indicating a clear divergence among artificial intelligence stocks after the sell-off of tech stocks last week.

Around 10:07 a.m. on November 9th, Eastern Time, NVIDIA's stock price was around $174.74, a decrease of 6.38%. Amazon rose by 5.5%, Alphabet rose by 3.46%, and Microsoft rose by 2.6%. At the same time, the broader Nasdaq index rebounded from its recent pullback.

Subsequently, NVIDIA regained some of its lost ground, and by around 11 a.m., the decline narrowed to about 3.8%. This divergence occurred after the company's board of directors issued an official statement confirming that it would comply with an independent investigation involving CEO Jensen Huang.

NVIDIA's stock price tumbles, and questions arise regarding Jensen Huang's investigation

NVIDIA's stock price once fell to a low of around $170.24 during trading, which is about 8.8% lower than the closing price of $186.64 last Friday, before it managed to recover some of that decline.

This decline occurred after the company announced on November 8th that its board of directors would investigate reports that Jensen Huang was allegedly targeted by foreign intelligence operations.

Independent directors will supervise this review with the support of external legal counsel.

However, NVIDIA emphasizes that there is currently no reason to believe that company secrets or U.S. national security have been compromised. The board of directors also expresses confidence in Jensen Huang's leadership abilities.

This investigation has added to the uncertainty at the company level following NVIDIA's recent stock selling pressure. Previously, NVIDIA's stock price fell by 9.26% on November 5th.

Amazon, Microsoft, and Alphabet lead the rebound of AI stocks

As investors resumed buying into companies that suffered heavy losses during last week's market pullback, a broader tech sector saw a rebound.

Amazon rose by about 5.5%, while Microsoft and Alphabet rose by 2.6% and 3.46% respectively.

This rebound has also extended to semiconductor companies that compete with NVIDIA.

Broadcom rose by about 6.5%, and AMD and Marvell also recorded strong gains, in contrast to NVIDIA's weakness.

The Philadelphia Semiconductor Index rose by about 3.3% in the early session, indicating that investors have not abandoned the entire AI industry.

This rebound occurred after a significant contraction in the valuation of semiconductor stocks, as investors re-evaluated the costs of expanding computing infrastructure.

Microsoft, Amazon, and Alphabet still face considerable AI expenditures, but their cloud computing, advertising, and enterprise software businesses provide sources of revenue in addition to the sales of specialized chips.

At the same time, Nasdaq's pullback has raised a question: can tech stock valuations recover without stronger earnings and an improving financial environment?

NVIDIA's financial reports and U.S. inflation data become key tests

Before a series of events that are important to tech investors occur, this differentiation is particularly noteworthy.

NVIDIA is scheduled to release its financial report on November 17th, at which time shareholders will assess the demand for AI processors as well as the company's outlook for data center expenditures.

Prior to this, CoreWeave will release its financial report on November 10th, which will provide another clue regarding the financial situation of the AI infrastructure market.

The company is facing increasing pressure in the credit market, hence its financing costs and future expenditures are of particular concern.

Investors are still awaiting the release of the U.S. Consumer Price Index ( CPI ) on Tuesday, as these data could affect market expectations regarding Federal Reserve interest rates.

Higher inflation could drag down valuations of tech stocks, while more modest data could support a broader rebound in the stock market.