AMD and other chip stocks slide as Wall Street rethinks the AI trade without Jensen Huang

By Hannah Pedone

Nvidia could scale back its status as the 'central bank of AI,' analysts say - and that could have repercussions across the tech sector

AMD's stock has more than erased the gains it sustained in Thursday's session.

At first, it looked like Nvidia's pain might be the rest of the chip sector's gain. But now, investors aren't so sure.

After news broke this weekend that Nvidia's (NVDA) board of directors had launched an investigation into whether one of former CEO Jensen Huang's relationships compromised business secrets, the PHLX Semiconductor Index SOX posted a 10.6% gain across the first four days of the week. The thinking was that a potentially weaker Nvidia could mean more opportunities for direct rivals and afford more pricing leverage to suppliers. Huang resigned as Nvidia's chief executive on Thursday morning.

But the SOX index was down 3.4% on Friday as investors grappled with the idea that Nvidia and Huang served a dual function in the technology ecosystem - not only supplying chips but also propping up the artificial-intelligence industry from a financial standpoint.

Shares of Advanced Micro Devices (AMD), which rose in the immediate aftermath of Huang's resignation, slid 8.8% on Friday, pacing the S&P 500's SPX decliners. Shares of Sandisk (SNDK) were down 5.6%, while those of Broadcom (AVGO) fell 4.8%, and shares Intel (INTC) and Micron Technology (MU) each lost 2.5%. Dell's stock (DELL) was off 7.2%.

(END) Dow Jones Newswires

11-13-26 1610ET