AI stocks bounce back — with one notable exception

Data: FactSet; Chart: Matt Phillips/Axios The AI trade has regained momentum despite — or maybe because of — Nvidia's struggles following the weekend revelations from CEO Jensen Huang. The big picture: Monday's sudden burst of exuberance for AI was the latest wide swing for a market upended by last week's "blue tsunami" in the midterm elections and the threat they could pose to the data center boom. By the numbers: The Nasdaq 100 index of large-cap technology shares soared 3.4%, its biggest daily jump since late March and its second-best showing of the year. Zoom in: Stocks romped across the AI ecosystem — well, with one important exception. Pick-and-shovel plays such as engineering and construction companies, and makers of data center inputs like fiberoptic cables, servers and data storage devices soared. The companies that build and lease out data center computing power, known as neoclouds, also jumped. (Those companies had been at the epicenter of recent jitters about financing for the AI boom.) Hyperscalers rose, paced by Meta, which notched a gain of 5.1%. Semiconductors roared, with the SOX index posting its best gain — 6.9% — since late July. Yes, but: The glaring exception to the AI-palooza was its best-known player, Nvidia. Weekend revelations from CEO Jensen Huang — who acknowledged having an affair with a woman suspected of connections to Chinese intelligence — left investors grappling with uncertainty about the CEO's future. The intrigue: Some investors may see Nvidia's pain as potential gain for rivals. Broadcom jumped 8.8%, its best day in nearly a year. Advanced Micro Devices soared 13.3%, benefiting also from an upgrade to "Outperform" — effectively, a "buy" recommendation — from Oppenheimer analysts on Sunday. Context: Bullish commentary from Wall Street established the background music for Monday's big bounce, as analysts urged investors to buy into the market's recent soft patch. "We believe stocks are now clearly in oversold territory," Goldman S