Chip Index Jumps 6.86% as Nvidia Drops 4.27% on Wall Street

By Marcus Bennett

The Philadelphia Semiconductor Index rose 6.86% on the 9th as bargain hunters lifted all three main Wall Street indexes by more than 2% and retreating oil prices supported the advance.

How did the three main indexes close?

• The Dow Jones Industrial Average closed at 52,389.75 at the New York Stock Exchange on the 9th, up 1,104.02 points, or 2.15%.
• The Standard & Poor's 500 rose 173.08 points, or 2.35%, to 7,549.94.
• The Nasdaq Composite gained 673.71 points, or 2.74%, to 25,253.14.

All three benchmarks gained more than 2%, with the advance holding from the opening bell through the close across the full New York trading session. The semiconductor benchmark posted the larger percentage gain. Technology supplied several of the strongest stock advances.

What drove the rebound?

Stocks moved higher from the opening bell as bargain hunters returned. The market had been recovering since the 6th from a plunge on the 5th. The sell-off followed a sweeping Democratic Party victory in the U.S. midterm elections, which investors viewed as unfriendly to artificial-intelligence data-center construction. The election result supplied the earlier catalyst. Renewed bargain buying supplied the rebound.

Which companies led the advance?

Among the largest companies by market value, most technology and blue-chip shares advanced. The gain list mixed chip makers, technology platforms, financial, retail and pharmaceutical names, while Nvidia was the only major large-cap decliner on the session.

• Apple rose 2.43%, Microsoft 2.75%, Amazon 2.94%, TSMC 3.51% and Google parent Alphabet 1.18%.
• SpaceX gained 5.81%, Facebook parent Meta 5.12%, Tesla 5.54%, Eli Lilly 4.27% and Walmart 0.11%.
• SK hynix rose 5.53%, JPMorgan 2.27%, AMD 13.26% and Micron 6.25%.

AMD's gain was the largest among the named large-cap advances. The Philadelphia Semiconductor Index rose 6.86%, far above the gains in the three broad indexes.

Why did Nvidia fall against the sector?

AMD gained 13.26% and Micron 6.25% in the chip group. Nvidia lost 4.27% and traded as much as 8.8% lower during the session. It was the only major large-cap decliner.

The decline followed Chief Executive Jensen Huang's acknowledgment of an extramarital relationship with a businesswoman suspected of having been recruited as a spy by Chinese intelligence.

Nvidia's board said on the 8th that it had launched an independent investigation into recent reports that Huang had been targeted by a foreign intelligence service. The board stated that it had found "no evidence that national security or company secrets had been compromised."

Why did oil retreat?

West Texas Intermediate crude for December delivery settled at $86.85 a barrel on the New York Mercantile Exchange, down $3.98, or 4.38%, for the session. Brent crude for January delivery, the global benchmark, fell $5.75, or 5.85%, to $92.57 a barrel. Steadier oil prices also supported the rally.

President Donald Trump said in a telephone interview with CNN on the 8th: "the chances of resuming military strikes against Iran were very low." CNN reported that he repeated five times that military action was highly unlikely.

What does the rally change for investors?

For investors, the immediate change was a broad rebound after the election-driven plunge, with chip strength broad enough to outweigh Nvidia's company-specific decline on the day. AMD's 13.26% gain led the named large-cap advances. Nvidia was the only major large-cap decliner.

The practical distinction is between sector exposure and company-specific risk. The semiconductor index gained 6.86%, but Nvidia remained under an independent investigation following the disclosure about Huang's personal life. The board found no evidence of compromised national security or company secrets. Nvidia still closed down 4.27%, after an intraday decline of as much as 8.8%.

Lower oil prices supplied broader support, with WTI down 4.38% and Brent down 5.85%. The immediate market picture changed from an election-driven sell-off to a broad recovery. Nvidia remained the specific exception.