NEW YORK (Realist English). US stock indices closed Tuesday’s trading session, 10 November, in the red. The Dow Jones Industrial Average fell 0.30% to 52,231.89 points, the Nasdaq Composite lost 0.74% to 25,065.87 points, and the S&P 500 declined 0.38% to 7,520.93 points.
Nvidia: scandal and sell-off
Nvidia shares were the main driver of the decline. Over two trading days, the company lost more than 9.5% of its capitalization, and its market value shrank by about $420 billion. During the trading session on 10 November, the stock fell almost 7%, and market capitalization briefly dropped below the $4 trillion mark.
Analysts highlight several factors behind the sell-off. First, concerns related to Nvidia’s business in China amid continued tension in US-China trade relations. Second, investor sentiment was affected by reports of a possible personal relationship between CEO Jensen Huang and a woman suspected of involvement in Chinese intelligence.
Huang himself admitted the affair on 8 November, and the company’s board of directors initiated an independent investigation, stressing, however, that “there is no reason to believe that US national security or Nvidia’s trade secrets have been harmed.”
Against this backdrop, Nvidia shares are trading about 30% below their recent peak, the largest correction since spring 2025. The company’s forward P/E multiple has fallen to 13.5x versus an average of about 19x for Nasdaq 100 companies, indicating a significant discount to historical valuations.
Oil: decline continues
Benchmark oil prices continued to fall. During trading on 10 November, Brent dropped below $90 per barrel for the first time since 31 August, and the January futures closed at $91.49. By 12 November, Brent was trading around $91.62 per barrel, while WTI was around $85.49.
Oil prices are under pressure from expectations of further de-escalation of the Iranian conflict and rising energy exports from the Persian Gulf. An additional factor was the release of US inflation data, which came in above forecasts and strengthened expectations of Federal Reserve rate hikes, which traditionally weighs on commodity prices.
Macroeconomic backdrop: inflation and rates
US inflation in October exceeded analysts’ expectations. Consumer prices rose 0.4% month-on-month versus a forecast of 0.3%, while core CPI, excluding food and energy, added 0.3% versus the expected 0.2%.
Against this backdrop, the yield on 10-year US Treasury bonds again exceeded 5%. Traders have little doubt that the Fed will raise rates by at least 25 basis points at its December meeting and are beginning to price in the possibility of a more aggressive 50 basis point hike.
“The market is concluding that the Fed may have to act more aggressively next year… These CPI data suggest that inflation may prove more persistent and prolonged than previously thought,” said Tom Hainlin, national investment strategist at U.S. Bank Asset Management.
Current market dynamics reflect the overlap of two multidirectional but equally destabilizing factors. On the one hand, there is a crisis of confidence in Nvidia — the flagship of the tech sector, whose capitalization determines the dynamics of the broader market.
The scandal surrounding the CEO, even in the absence of confirmed national security threats, has created uncertainty that investors are unwilling to ignore. On the other hand, the macroeconomic backdrop — persistently high inflation and the prospect of Fed tightening — limits risk appetite and puts pressure on commodity markets.
The key question for the coming weeks is whether Nvidia can restore investor confidence after the internal investigation concludes, or whether its correction will become a trigger for a broader reassessment of the entire tech sector amid tightening financial conditions.
