Asian markets showed signs of stabilization on Friday after Nvidia CEO Jensen Huang announced his resignation the day before. His departure sent shockwaves through AI-linked stocks and contributed to a slight uptick in the dollar as Treasury yields climbed.
The unexpected leadership change came at a time when investors were already concerned about stricter US chip-export regulations and their potential impact on AI growth. JPMorgan, a prominent US bank, noted that Huang’s exit creates a significant void that will be challenging to fill. The bank warned that new AI-infrastructure deals might face delays or require higher compensation, as Nvidia often plays multiple roles beyond just selling chips.
Markets interpreted the resignation as a broader risk reset, with some AI-related stocks declining and copper prices weakening. Traders reassessed the near-term demand for industrial metals like copper, which is heavily used in power, networking, and cooling equipment for data centers. The uncertainty also boosted the dollar, as traders increased the probability of a larger Federal Reserve rate hike later this year.
For investors, JPMorgan’s analysis helps explain the swift reaction in copper and mining stocks. If lenders and investors start viewing AI projects as riskier, they may demand higher interest costs and stronger protections, potentially slowing the approval of new data centers. This slowdown could first appear in input markets, affecting prices and high-volatility miners like Capstone Copper, which dropped more than 5%.