Nvidia CEO Jensen Huang said the company's dealings with a firm involved in a U.S. spy probe were "normal," but his defense did little to ease investor anxiety over national security implications tied to the chip giant.
Nvidia shares fell 0.8 percent to $213.66, while the Nasdaq Composite dropped 1.4 percent to $26,185 and the S&P 500 slid 0.3 percent to $7,720.
The selloff reflects intensifying U.S. regulatory scrutiny of technology supply chains and international partnerships in sensitive sectors. For the bond market, increased geopolitical risk typically triggers a flight to safety—institutional money rotates from equities into Treasuries, particularly duration-heavy allocations on the long end of the curve. This reshuffles the yield curve: long yields compress as demand surges while short-term rates remain anchored by the Fed, flattening the curve's slope.
Sustained U.S.-China tech friction could trigger a broader repricing of risk assets. That scenario historically accelerates Treasury demand and pushes yields lower, as investors hedge equity volatility and repriced recession risk through duration exposure.
