Why Nvidia’s stock is dodging the AI credit scare that is crushing Broadcom and Oracle

The AI credit scare has not spared the sector's biggest names equally. According to the source, price-to-earnings ratios have contracted and credit default swap spreads have widened for Nvidia, Broadcom, and Oracle alike — yet Nvidia's stock has held up while its peers have borne the brunt of the selling.

That divergence matters because it suggests investors are treating AI-related credit risk as company-specific rather than sector-wide. CDS spreads are essentially insurance premiums against a borrower defaulting, so widening spreads signal that bondholders want more compensation to hold that debt. When those spreads move alongside falling P/E ratios, it usually points to doubts about how AI spending is being financed, not just about growth prospects.

What to watch: whether the spread widening at Broadcom and Oracle stabilizes or spreads to other AI-linked balance sheets, and whether Nvidia's relative resilience persists if credit conditions tighten further. For now, the market appears to be drawing a distinction between AI demand and the leverage used to fund it.