Financial Analyst/Content Writer, RADEX MARKETS
Lawrence J. came from a strong technical and engineering background before pivoting into a more financial role later on in his career. Always interested in international finance, Lawrence is experienced in both traditional markets as well as the emerging crypto markets. He now serves as the financial writer for RADEX MARKETS.
CHIA SẺ
In an increasingly predictable move, Jensen Huang has stepped down as the CEO of Nvidia after two separate extramarital affairs were made public. The first, involving Chinese businesswoman Alice Huang, was publicly acknowledged by the outgoing CEO in a message addressed to all staff members over the weekend. The second, involving Nvidia Vice President of healthcare Kimberly Powell, has not yet been formerly recognised. In a statement released by Nvidia on Thursday, the board of directors of the company announced that Huang had ‘resigned as President, Chief Executive Officer, and a member of the board, effective immediately’. The press release went on to confirm that Colette Kress, current Executive VP and CFO, has agreed to serve as interim CEO until a suitable successor has been named. While short, the statement acknowledged and thanked Jensen for his ‘immeasurable contributions to the company and the industry’.
Wall Street was not impressed. NVDA shares opened 13% lower as the opening bell ushered in Thursday’s trading session, before markets stepped in to buy the dip, eventually bringing the company to a more modest 4% loss on the day. Nvidia stock is now down over 30% from its October record high; the company is far from alone in its fall from grace. The wider chip sector has been struggling for a number of weeks already, illustrated well by the benchmark Philadelphia Semiconductor index (SOX), which has lost 28% since the start of summer. None of the events in the current news cycle are helping. The Democratic midterm sweep has conjured a dark cloud over the industry, threatening future growth prospects with potential regulatory headwinds. Investment is stalling as financiers wrestle with the huge sums of money being thrown at AI ventures, all while macroeconomic conditions continue to tighten as the US Treasury floods the bond market with new short-term bills, siphoning away institutional capital that could otherwise be deployed in riskier assets.
As bad as the situation appears within certain subsets of the US stock market, the overall picture is far more optimistic. The major indices have all enjoyed strong performances so far this week, completely erasing the damage from the week prior and then some.
The liquidity squeeze is wreaking havoc on a number of markets this week. Precious metals had very little to say for themselves yesterday as gold crumbled below the critical $4,000 threshold, falling to $3,876 by the end of the day and revisiting prices not seen in over a year; despite falling 3%, silver managed to hold on to $50 by the skin of its teeth last night.
Things went from bad to worse in cryptocurrencies after Bitcoin plummeted into the void in search of some kind of price floor. The original cryptocurrency crashed all the way down to $71,300 per coin late on Thursday night and is in the red once again this morning. Bitcoin is already down 18% from its September rally and unless it reclaims $75k by Sunday night, so-called digital gold will paint its sixth consecutive weekly red candle. The entire crypto ecosystem is in a genuinely pitiful state, as investors grapple not only with the shockingly awful price action that has marred the industry over the last five years, but also the complete lack of hope when it comes to future adoption or regulatory leniency. With no light at the end of the tunnel, sentiment remains understandably dour.
With nowhere else to turn, markets are once again flooding back into the dollar. The DXY has officially surpassed 103, putting immense pressure on other major currencies but perhaps on the euro most of all, which is now rapidly approaching $1.10. The yen also felt the sting after USDJPY rose back up to the all-important 160 mark, a level that has previously forced the Bank of Japan’s hand on several occasions. The Federal Reserve may well opt for multiple rate hikes over the next few months while other central banks may be more reticent to do so, further bolstering the appeal of the greenback. US PPI figures later today could add another chapter to monetary forecasts.
About the Author
Lawrence J. came from a strong technical and engineering background before pivoting into a more financial role later on in his career. Always interested in international finance, Lawrence is experienced in both traditional markets as well as the emerging crypto markets. He now serves as the financial writer for RADEX MARKETS.
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