Chinese AI shares slide as Nvidia chief resigns amid spy scandal and US export fears

Chinese AI shares tumbled on Friday as investors worried about the departure of Nvidia CEO Jensen Huang. US House Speaker Mike Johnson said on Thursday that a growing consensus exists in Congress to limit chip exports to China following the leadership change. Huang stepped down after news reports of a romantic relationship with Alice Huang, a Chinese businesswoman suspected by US authorities of spying for Beijing. Beijing has denied that Alice Huang is a spy.

Reactions and Market Impact

Lawmakers from both parties have called for tougher curbs on advanced AI chips. Senior White House officials also discussed whether Commerce Secretary Howard Lutnick should be pushed out over the administration's refusal to add dozens of Chinese companies to a US trade blacklist. Investors reacted by dumping shares in Chinese AI models and hardware suppliers. AI model stocks Z.AI and MiniMax Group slumped 12% and 8.4% respectively, while data center suppliers Zhongji Innolight and Eoptolink Technology dropped more than 8%. Meanwhile, Chinese AI companies are reportedly trying to rent Nvidia-powered computing capacity outside China to bypass potential remote access restrictions.

Legislative Push

Congressional Republicans want to attach new chip export restrictions to the annual defense authorization bill. Lawmakers are pressing for at least four bills, including the AI Overwatch Act, the Chip Security Act, the Match Act, and the Remote Access Security Act. Sunny Cheung, an analyst at the Jamestown Foundation, said Huang's resignation will not end congressional scrutiny and could leave him more exposed to investigation. Huang is expected to testify before Congress before November 26 after House Republicans requested a briefing.

Context

Nvidia designs advanced graphics processing units that power modern artificial intelligence systems globally. Export controls on these chips form a central part of technology policy debates between the United States and China.