SoftBank Sells Entire NVIDIA Stake, 'AI Tech Stocks' Shaken [New York Market Briefing]

Major U.S. stock indices closed mixed.

On the 11th (U.S. local time) at the New York Stock Exchange, the Dow Jones Industrial Average closed at 47,927.96, up 559.33 points (1.18%) from the previous trading day.

The Standard & Poor's (S&P) 500 index rose 14.18 points (0.21%) to 6,846.61, while the Nasdaq Composite Index closed down 58.87 points (0.25%) at 23,468.30.

Large-cap stocks rose while technology stocks fell.

The Philadelphia Semiconductor Index, composed of AI and semiconductor-related stocks, plunged 2.48%, showing cooled investor sentiment.

The tech sell-off was influenced by news that SoftBank sold its entire stake in NVIDIA. SoftBank Group said in its third-quarter earnings disclosure that it sold all NVIDIA shares for 5.83 billion dollars.

This fueled talk of an AI peak and reinforced perceptions of overbuying. NVIDIA, Broadcom, TSMC, and ASML each fell in the 1% range, and AMD also fell 2.65%. Twenty-seven of the 30 stocks that make up the index fell.

AI-themed stock selling also pushed down Oracle (-1.94%) and Palantir (-1.37%).

Pharmaceutical stocks were strong. Eli Lilly, the largest by market capitalization among pharmaceutical stocks, rose 2.27%, and Amgen jumped 4.57%. Traditional defensive-sector stocks such as Walmart, Visa, and Coca-Cola were also strong.

U.S. economic indicators pointed to a weakening trend.

According to private employment firm ADP, for the four weeks ending on the 25th of last month, the preliminary U.S. private employment reading decreased by an average of 11,250 per week. ADP had previously reported that private employment increased by 42,000 month-on-month in October.

Jeongdong Noh, Hankyung.com reporter dong2@hankyung.com