STOCKS | CITIC Securities: Tech Leadership Changes May Raise U.S. Market Volatility, While Systemic Selling Pressure May Stay Limited

According to Jin10, CITIC Securities said Jensen Huang’s departure, combined with changes in the U.S. political landscape, could prompt a reassessment of AI industry valuations and a rebalancing of U.S. equity market styles. The medium-term outlook for U.S. stocks will still depend on corporate earnings fundamentals. In the short term, markets may reprice slower AI capital spending growth and lower semiconductor earnings expectations, though supply-chain inventory risks are relatively limited and hardware-sector adjustments may remain manageable. Slower growth in AI capital spending could improve cloud service providers’ free cash flow, while potential declines in long-term interest rates could benefit the SaaS sector. U.S. midterm elections and changes in technology leaders’ management could heighten short-term market volatility, but systemic selling pressure may remain relatively limited. As political risks are gradually priced in, U.S. equity valuations may shift from being driven by short-term risk sentiment back toward corporate earnings fundamentals, with earnings growth and upward revisions to earnings expectations potentially supporting the market over the medium term.