Nvidia shares rise 5.3% in premarket trading after two-day decline — CNBC

In the United States, Nvidia shares rose 5.3% in premarket trading on Wednesday after two days of declines. On Tuesday, the company’s shares closed down 5.47%, while on Monday they lost 4.3% of their value.

Review of potential risks

As CNBC reports, Nvidia said on Tuesday that it had retained the law firm Wachtell, Lipton, Rosen & Katz. The firm is to determine whether the company’s secrets or national security may have been compromised.

The review is taking place amid reports about Nvidia CEO Jensen Huang’s relationship with a woman whom CNBC describes as a suspected Chinese spy. According to the outlet’s sources, Huang returned to the office on Monday and held meetings on Tuesday. Nvidia is set to release its quarterly financial results on November 17.

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Analysts’ assessments

Bank of America analysts outlined three possible scenarios for investors. The first envisages containing the consequences while maintaining leadership continuity, the second involves prolonged uncertainty and pressure on the company’s valuation ahead of its earnings report. The third scenario envisages escalating consequences in the event of unfavorable review findings, leadership changes, or stricter restrictions.

Morgan Stanley on Wednesday removed Nvidia from its list of top investment ideas. The bank’s analysts noted that the company’s shares had lost more than 25% since being added to the list on October 2, and that Huang’s leadership is important to Nvidia’s strategic development.