Stocks split directions to end the week. The Nasdaq Composite slipped 0.91% to 25,136.27, the S&P 500 eased 0.4% to 7,561.67, and the Dow added 50.46 points, or 0.1%, to 52,347.55.
Even so, it was a solid stretch. The Nasdaq advanced 2.3% for the week, the S&P 500 rose 2.5%, and the Dow gained 2.1% - the strongest weekly gains for all three since early August.
Stocks initially firmed after October producer prices came in a touch lighter than forecasts. The producer price index - wholesale inflation - increased 0.3% on the month, below the 0.4% economists surveyed by Dow Jones expected.
The same report showed a 6.5% jump from a year earlier, marking the sharpest annual rise since November 2022.
Nvidia was a drag again. Shares fell 2% Friday, adding to a drop of more than 4% the day before after founder and CEO Jensen Huang left the company. The Thursday pullback extended beyond one ticker, with the Dow, S&P 500, and Nasdaq all retreating after his departure. His exit followed reports of extramarital relationships, one alleged partner being a woman whom U.S. intelligence says is a Chinese spy.
Colette Kress, Nvidia's CFO for more than a decade, is stepping in as interim CEO while the board looks both inside and outside the company for a permanent successor. HSBC lowered its rating to hold, saying the shares are likely to drift until a long term leadership plan is in place. Analysts told CNBC Huang's departure could set off a 20% pullback in the stock.
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Thomas Martin at Globalt Investments expects the CEO search to "take a lot of time," and added, "What will happen to those types of financing arrangements, and will there be less of them just going forward or will there actually be unwinding of them?" He continued, "What are the relationships going to be with their suppliers and with their customers? It's just early days."
Baird's Ross Mayfield said a good chunk of the damage looks already reflected in the price and he still sees choppiness ahead. He also expects investors to keep moving money toward areas outside of AI regardless of the latest Nvidia headlines. "It hasn't really changed the broad tenor of the market."
Two forces pulled at stocks this week: leadership risk at a market heavyweight and a mixed inflation read. The first amplified stock specific swings, and the second left rate path guesses unsettled. Translation for positioning: expect more rotation under the surface even as the major indexes find their footing.
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