PiCK

Summary

  • Reports said allegations of Chinese espionage could weaken investor sentiment toward Nvidia and technology stock sentiment in Asian equity markets.
  • Following the report, futures contracts tracking Nvidia shares, futures on major US stock indexes, and Bitcoin (BTC) showed sharp volatility.
  • Markets are focused on the probability of a Federal Reserve rate increase, the US consumer price index (CPI), and China’s consumer and producer price data as key variables shaping the direction of financial markets.

Forecast Trend Report by Period

Allegations of Chinese espionage targeting Nvidia Chief Executive Officer Jensen Huang could undermine investor sentiment toward technology stocks in Asian markets, Bloomberg reported.

Bloomberg reported on November 8 that Nvidia’s board has started an investigation into whether Huang was targeted by a foreign intelligence agency. The US government suspects Alice Huang, a former executive at Megaspeed International, may have been recruited by Chinese intelligence and may have approached Jensen Huang.

The report sent prices lower for futures contracts tracking Nvidia shares on decentralized trading platform Hyperliquid. Futures on major US stock indexes also swung between gains and losses in early Asian trading. Bitcoin fell to as low as $74,000 before recovering the $75,000 mark, highlighting elevated volatility.

The allegations emerged after global technology shares had already suffered a sharp correction. Last week, concerns over lofty valuations tied to artificial intelligence pushed Japanese and Taiwanese stocks into technical bear markets, while global equity indexes fell to their lowest level in six months. Uncertainty over fiscal policy and the regulatory environment after the US midterm elections has also weighed on sentiment.

Nick Twidale, chief market analyst at AT Global Markets, said the espionage allegations surrounding Nvidia would weigh on Asian markets early this week. They are also creating considerable uncertainty over the outlook for one of the world’s biggest AI companies, he added.

Oil prices, by contrast, fell on expectations of easing tensions between the US and Iran. After US President Donald Trump said the likelihood of additional airstrikes was very low if progress was made in nuclear talks and discussions on reopening the Strait of Hormuz, Brent crude traded near $97.50 a barrel, down 0.8%.

In foreign-exchange markets, the dollar was mixed against major currencies. The greenback rose 0.4% last week, supported by safe-haven demand following the global equity selloff and stronger-than-expected US employment data. Markets are pricing in about an 80% chance that the Federal Reserve will raise interest rates by year-end.

Investors are now turning their attention to the US consumer price index due on November 10. The data will be a key gauge of the Fed’s rate path, while China’s consumer and producer price figures are also set to influence the near-term direction of Asian financial markets.

Suehyeon Lee