Nvidia’s show of financial force soothes credit markets

Six of the biggest names in finance are helping Nvidia ease some of the investor anxiety that’s been building for weeks over its swelling commitments to backstop the artificial intelligence boom.

The early signs came after Nvidia CEO Jensen Huang announced Monday that the coalition of major investment firms including BlackRock and Goldman Sachs Group were lining up more than $500 billion to help fund the AI build-out. The group will independently judge individual deals and their own participation level, while Nvidia’s contribution will be relatively limited, and only factor into some deals.

The idea is that outside money, sophisticated eyes on deals and Wall Street’s stamp of approval should help alleviate worries that Nvidia was inflating an AI asset bubble with circular financing. In less than three weeks, a gauge of the chipmaker’s credit risk had nearly doubled on concern that while loans to customers would bring more sales, they risked causing pain later if those customers fail.