From Decrypt · By Jose Antonio Lanz
In brief
Nvidia shares plunged as much as 8% Monday, threatening to erase $350 billion in market value even as the S&P 500 rallied.
Nvidia's board has backed Jensen Huang, but his potential departure raises serious questions about succession.
The stock has broken below its 50-week exponential moving average, exposing support levels near $164 and potentially $150.
Nvidia shares plunged as much as 8% Monday, briefly threatening to erase roughly $350 billion in market value as investors weighed the possibility that CEO Jensen Huang could lose his job over an alleged Chinese intelligence operation.
For a company that has become the face of the artificial intelligence boom, that's a rather expensive scandal. And the investigation is just getting started.
Nvidia's board opened an independent investigation following reports that Huang had a romantic relationship with a business executive whom U.S. intelligence believes was recruited by China's Ministry of State Security.
PredictEconomyNVDA Lows in November
16047%YesNo16869%YesNo176-%YesNo184-%YesNo192-%YesNo+2 more outcomes+1 more outcomesNEW$0.00 volumeCloses: Dec 1, 2026, 04:59 UTCCloses: Dec 1, 2026, 04:59 UTCHuang acknowledged being unfaithful to his wife in a message to employees, apologized and pledged to cooperate. Nvidia's board said it had no reason to believe company secrets or U.S. national security had been compromised, and expressed confidence in his leadership.
The allegations have not established that Huang disclosed sensitive information or knowingly cooperated with foreign intelligence. Investors, however, are already confronting the possibility of a much bigger problem.
Nvidia was already losing trillions
Nvidia's market capitalization had declined from roughly $5.78 trillion on October 6 to $4.51 trillion by November 6, according to YCharts. That's approximately $1.27 trillion in lost value before the board publicly announced its investigation.
The latest controversy adds another risk to a stock already under pressure from questions about the sustainability of massive AI infrastructure spending.
Nvidia also carries enough weight to move the broader market. A November 6 snapshot placed the company at 6.93% of the SPDR S&P 500 ETF, which tracks the market-capitalization-weighted index of major U.S. companies.
At that weight, a 5.6% decline in Nvidia alone would subtract approximately 0.39 percentage points from the S&P 500's performance, assuming everything else remained unchanged—which most likely will not happen, considering Nvidia is the main hardware provider for many other companies in the country, including some in the top 10.
Yet the S&P 500 rose 1.48% Monday morning, while the Nasdaq gained 1.87%. Other semiconductor stocks also rallied, suggesting investors were treating Nvidia's troubles as largely company-specific rather than abandoning the broader AI trade.