European stocks hit record high after Nvidia storm rattles Asia

[LONDON/SINGAPORE] Fresh turbulence hit global stocks on Thursday (Nov 12) as a spy scandal threatened to oust chip giant Nvidia’s chief executive officer, while US Treasury yields touched 5 per cent again and the greenback reached a 19-month high on firming US rate rise bets.

There was early cheer for Europe where the comparatively tech-light Stoxx 600 hit its first record high since August, but elsewhere the strains were showing.

Asian markets suffered falls overnight after reports that Nvidia’s board had met to decide the fate of long-time leader Jensen Huang sent the company’s shares diving nearly 7 per cent in pre-market US trading.

Chinese tech firms that use Nvidia chips for their artificial intelligence models fell heavily in Hong Kong.

Alibaba and Tencent tumbled 6.7 per cent and 2.6 per cent respectively amid concerns that Washington may now curb access to offshore data centres with the most advanced processors.

Many of the other global market issues were back in play too.

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Brent oil had bounced back above US$92 a barrel as persistent tensions in the Middle East offset rising regional output, while the US dollar was at its highest since April 2025 in the aftermath of US President Donald Trump’s “Liberation Day” tariff announcements.

The US currency has gained almost 1.5 per cent since hot inflation data earlier this week triggered a repricing of expectations for another US Federal Reserve rate hike in December.

A week ago, traders saw a one-in-three chance that the US central bank would hold steady. Now they price a 90 per cent chance of a 25 basis point hike, and ascribe 9.2 per cent odds of a larger 50 basis point hike, according to the CME Group’s FedWatch tool.

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“The Nvidia issue has played its part in creating a risk-off move that is pushing up the US dollar,” Societe Generale strategist Kit Juckes said.

“The deep driver though is the big shift in the tone around inflation ... The market is now off the fence on the question of whether there is an inflation problem.”

Wall Street worries

That shift was being felt in bonds too. The US 10-year Treasury yield briefly hit 5 per cent again in Europe after US bond markets had been closed on Wednesday.

Momentum was lacklustre though. Germany’s 10-year Bund yield – the benchmark for much of Europe – nudged down to 3.3 per cent, though it was still set for a weekly rise of around 5 basis points.

In contrast to Europe’s record high for stocks, Wall Street futures were 0.5 per cent weaker amid the furore around Nvidia, a firm which until recently had been the world’s most valuable company.

A flurry of reports said Nvidia’s boardhad met late on Wednesday to decide whether to oust its long-time CEO Huang following allegations that he had an affair with a suspected spy for China.

The New York Times has also reported that Huang had had an affair with a fellow Nvidia executive.

“It looks bad from every single angle,” said Jake Dollarhide, chief executive officer at Longbow Asset Management in Tulsa, Oklahoma.

“I believe the board won’t oust him until they have an all-star, a known entity in the tech sector, to replace him,” he said. “At the end of the day, let’s not forget that the Nvidia chip is the centrepiece of the AI story.”

It was not yet clear who might replace Huang as CEO if he goes. In the meantime, Chinese domestic GPU makers surged on Thursday as expectations rose that Nvidia’s troubles could help local chip suppliers win greater market share.

Saxo Bank’s chief investment strategist Charu Chanana said Nvidia earnings next Tuesday are the next key test.

“Strong results could reaffirm the AI growth story, but may not fully remove the governance discount,” she said. REUTERS