Broad Market Rally Leaves Nvidia Decline an Outlier

NVIDIA's stock falls on news of the company's investigation into CEO Jensen Wang, but its competitors are rallying. Plus, ER patients waiting to be admitted to the hospital are spending hours in emergency room hallways. They could be put right next to the nurse's station on a bed for the entire night. And really with no privacy, no sort of buffer from the lights and from the noise, it makes it difficult to sleep. And the House begins the process of impeaching Defense Secretary Pete Hexeth. It's Monday, November 9th. I'm Alex Oseleff for The Wall Street Journal. This is the PM edition of What's News, the top headlines and business stories that move the world today. As we reported this morning, NVIDIA has opened a probe into CEO Jensen Wang's romantic relationship with an executive suspected of working for Chinese intelligence. The news sent the company's stock sliding more than 4 percent, erasing more than $232 billion in market value. But NVIDIA was an outlier in today's U.S. markets. The major three indexes each added more than 2 percent, and the Dow rose more than 1,100 points. Other chipmakers and NVIDIA competitors saw particularly big gains, with AMD adding more than 13 percent and Broadcom rising almost 9 percent. I'm joined now by WSJ Heard on the Street editor Aaron Back. Aaron, with this boost to AMD and Broadcom, what are investors betting on here? There's been a push in the AI space for a long time to kind of diversify away from excessive reliance on NVIDIA chips. And so to the extent there are doubts in the market about NVIDIA, there is added incentive for customers, governments to look at diversifying the supply base. NVIDIA has invested in so many AI companies. What does it mean for the broader AI trade, if its fortunes fall? It would be negative because NVIDIA has really become a backer of the entire sector. They've taken equity stakes in companies like CoreWeave. They've issued financing guarantees for data centers and things like that. They're really using their balance sheet aggressively to support the entire sector. So to the extent that the company's fortunes seriously decline, you would be looking at less of that support, less of that financial backstop. I don't see that as necessarily a likely outcome. At this stage, I think what you might see is perhaps a more slightly cautious NVIDIA. I think that could actually be maybe long-term healthy for the sector. Ultimately, a lot of these companies are going to have to stand on their own two feet, right, if the AI economy is going to be a healthy one. They can't be taking investment money from NVIDIA and using that money to buy NVIDIA chips ad infinitum. That's not sustainable long-term. So we're going to be, of course, watching developments for NVIDIA and Jensen Huang, right? Right. throughout the week. But one likely outcome, you write, is that regulators are likely to impose stronger controls on where the most advanced AI chips are sold. And that would be a big benefit for NVIDIA's U.S. customers. Walk us through that investor thinking. It's very likely that the government is going to take a second look at some of these loopholes that have allowed the most advanced chips to reach China. And companies themselves are going to have an incentive to do greater due diligence on who exactly is buying our chips, especially. when they sell chips overseas to protect themselves from negative publicity, negative political fallout. That could be long-term beneficial to many U.S. players in the sector. And so in addition to NVIDIA competitors rallying on Monday, we also saw NVIDIA customers rallying. This includes the biggest tech companies in the world, your Amazons, your Microsofts, your Metas, your Googles. They're spending hundreds of billions of dollars on these chips. And they don't want to be competing with Chinese buyers for those chips. They're probably going to get better allocations of chips, maybe even at better prices, to the extent that foreign buyers are shut out. What about the big frontier AI companies, the open AIs, the Anthropics in particular? Is the idea that China might be more blocked from chips, and that means they'll have more access? Yeah, the same logic applies. One of Anthropics' biggest problems is getting enough chips to keep developing their models. And they don't want to be competing with DeepSeek in China for access to those chips. And in fact, Dario Amadei, has been one of the most vocal advocates of export controls on China. And today, he looks a little more vindicated. That was WSJ Heard on the Street editor, Aaron Back. Thanks, Aaron. Thank you. One big question swirling around the NVIDIA investigation, who could replace Jensen Wang? An NVIDIA spokesperson said Wang is committed to staying on as CEO. But investors are questioning whether the probe could lead to his replacement. And if so, who could it be? WSJ tech policy reporter Amrith Ramkumar says that lack of clarity is a risk for NVIDIA. Jensen Wang is the face of the global AI industry. He's co-founded NVIDIA and really pioneered the GPU revolution that's powering the AI boom. He frequently talks to President Trump. He is basically propping up a lot of other AI companies with these unique financing structures. So people have said he's basically irreplaceable at the company and in the industry. Wang has also publicly said he's not a fan of succession planning and that he has roughly 60 direct reports. So people are sort of wondering what could happen if he had to leave or was sort of sidelined. So that's putting even more pressure on the company's board of directors. To hear more from Amrith, listen to tomorrow's episode of Tech News Briefing. We've got an update on last month's cyber attack on European supermarket refrigerators and freezers that caused tens of millions of dollars of damage in spoiled food and equipment. The U.S. and France suspect that Iran is behind it. Speaking at the G7 meeting in Paris today, France's foreign minister said that Iran would face retribution for the attack. U.S. officials confirmed that probes into the attack show the hallmarks of Iranian cyber methods, though an investigation is still going on. In political news, the effort to impeach Defense Secretary Pete Hegseth kicked off in earnest today, with Kentucky Republican Thomas Massey introducing articles of impeachment against him in the House. Massey, who's set to leave his position in January, alleges that Hegseth unlawfully initiated the Iran war and ignored a resolution from Congress to remove troops from the conflict. The move by Massey paves the way for Hegseth to become the first Pentagon chief to be impeached in the House in 150 years. But Hegseth says he's staying in his job, and he sounded dismissive of the impeachment effort today when he spoke to reporters after a speech at the Naval War College. We are very proud. Of the president's America First agenda, of our peace through strength posture. We know the world is a better and safer place as a result. And so if we want to litigate that, the success of those things, I'm happy to do it all day long. He's also planning a press conference tomorrow morning at the Pentagon to discuss the impeachment push. While Republicans control the House and in theory could try to insulate a cabinet secretary in this process, several of them have been critical of Hegseth. A vote could come by Wednesday, though Republican House leaders might try to head it off. We've talked on the show already about the national implications of last week's election. But one outcome you might not have heard as much about is the impact on statehouse races across the country. And there, like Congress, Democrats made huge gains. They flipped a dozen legislative chambers and gained full control in six states. That actually matters a lot to Americans' daily lives, because legislatures play an increasingly large role. WSJ National Affairs reporter Scott Calvert joins me now. Scott, why is it that you're not going to vote for Hegseth? Why are legislatures more important now than they used to be? And what kinds of policies are they going to be looking at? Congress, as a lot of people know, is often gridlocked, whereas at the state legislative level, a fair amount of laws actually do get passed. And in addition, court rulings have returned a lot of authority to the states. They've got control over tons of policy areas. You know, we're talking about education funding and health care. Think about minimum wage, abortion, gun laws to some extent. I want to talk a little bit about Arizona, which is one of 22 states in the United States. It's one of the 22 states that emerged from the elections with a trifecta. That's control of both legislative chambers and the governor's office. So how big a shift is this for Arizona? Well, it's huge, because the last time Democrats had a trifecta in Arizona was way back in 1966. So we're talking about, you know, 60 years. And the Democrats, including Governor Katie Hobbs, are very eager to use this clout in all sorts of ways. And, you know, she had this celebratory speech after the election, and she was talking about how they want to, you know, crack down on Arizona's school voucher program, and she says they're going to deliver $1 billion to our public schools without raising taxes. We're going to slash red tape for starter homes to lower costs and make it easier to build a life here at home. And expanding apprentice programs. And in Pennsylvania, which is another state where Democrats have not had a trifecta for a long, long time, in Pennsylvania's case, it was 1993, Governor Josh Shapiro, who was easily reelected, you know, he talked about how they're going to fund mass transit. They're going to raise the minimum wage. Broadly speaking, you're seeing Democrats talking about those sort of areas as ones they want to focus on out of the gate. That was WSJ National Affairs reporter Scott Calvert. Coming up, why a growing number of patients are stuck in the ER waiting hours or even days for a hospital bed. That story and more after the break. Thank you. U.S. regulators are requiring the makers of GLP-1 drugs like Ozempic and Zepbound to include a warning about a rare eye condition that can lead to blindness. Countries including the U.K., Japan, and Australia already require similar warnings for these drugs. Eli Lilly says it's evaluating the FDA update and will respond to the agency soon. While Novo Nordisk says it's working with regulators and that it remains confident the benefits of its GLP-1s outweigh the risks. If you've ever had the misfortune of visiting the emergency room, you know that it's generally not a pleasant experience. You're likely in pain, you're probably exhausted, and there's nothing to do about it but wait. And these days, it's not just the waiting room where you're waiting. Increasingly, patients who have already seen a doctor at the hospital are waiting. They're waiting hours for a bed. According to the consulting firm Vizient, between April and June this year, the median amount of time patients spent in the ER just waiting for a hospital bed rose to five hours, up 25 percent from the year before. For more on this, I'm joined now by Peter Loftus, who covers health care for The Journal. Peter, the practice of keeping patients in the ER is called warding. Why is this happening for longer these days? Well, it's happening because there's a lack of staffed beds in the inpatient wards. There have been shortages of certain types of health care professionals, like nurses. And so if there's fewer staffed beds, then that's going to create a bottleneck for the people coming in through the ER. Are we also seeing a shift in the people who are showing up to the emergency room? I mean, I'm thinking about how a growing number of people are going without health insurance because it's getting too expensive on the ACA marketplace. That was mentioned as one of the factors when I talked to people about this. That because people are driving. Instead of just going to a primary care doctor where they could kind of nip it in the bud, they let it go until it becomes a true emergency. And then so they end up in the ER. And if they had insurance, that might not have been the case. The population is getting older, so that's creating more medical issues. And that factors into both people visiting the ER, but also people being in the hospital. Hospitals now are actually seeing longer admissions because they're dealing with people that are having more acute medical issues. And they need to stay in their inpatient beds longer than in the past. So when we talk about boarding and we say people are waiting for a bed, I mean, where are they physically waiting if it's not in the waiting room itself? People are ending up on gurneys in the hallway. You know, they could be put right next to the nurse's station on a bed for the entire night. The article ran, I've been getting emails from people saying that they were in for days in the ER before they could get their own inpatient room. I have to think that this can't be great for patients. Does it present any real risks to them to have a longer boarding time? There have been studies that find that the longer they're boarded, the more at risk they are to having worse patient outcomes. And that's because of things like, you know, a lot of people are on chronic medication, say a blood thinner or diabetes medication. Going to the ER kind of disrupts that routine. And if they're in there for a long time, it increases the chances that they'll miss a dose of an important medicine. Whereas in the inpatient wards, they're a little more attuned to monitoring someone and being able to deliver their meds on a timely basis. Yeah, that's what Dr. Alexander Yonka told us. He's a co-author on a recent study about boarding that was published in the journal Health Affairs. And he's also a practicing ER doctor. And he's a professor at the University of Minnesota at the University of Minnesota. But my dad is on this really important medication. And what I have to say to that person is, no, I'm sorry. I'm sorry that I didn't already ask you about those meds. I'm sorry that you have to bring that up a second time or a third time. I'm sorry that it's taking so long for us to get your loved one out of the hallway and into a more private space. And you just get sick of having to do that. And you just get sick of having those conversations over and over again. So, Peter, hospitals must know that this is a problem. What are they doing to try to address this? Some hospitals are experimenting with different options. One is to make some changes with scheduling. Currently, a lot of the inpatient flow comes from elective procedures. You know, someone has open heart surgery. They're going to need to be in the ICU for several days. And a lot of those elective surgeries are scheduled for the first few days of the week. So there's a thought that if you could somehow try to spread them out, that could alleviate the bottleneck. But I think it's still very much a big challenge with a lot of different causes. Journal reporter Peter Loftus, thanks so much for telling us about this story. Thanks for having me on. And that's what's news for this Monday afternoon. Today's show is produced by Danny Lewis and Anthony Bansi with supervising producer Tali Arbel. We'll be back with a new show tomorrow morning. Thanks for listening. I'm Alex Oseleff for The Wall Street Journal.