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Yahoo
a few seconds ago
- Yahoo
Nvidia's Huang Wins China Reprieve in Trade War Reversal
(Bloomberg) -- Nvidia Corp.'s Jensen Huang spent months telling everyone what a grave mistake the US was making restricting shipments of artificial intelligence processors to China — with little sign that his argument was swaying anyone. The Dutch Intersection Is Coming to Save Your Life Advocates Fear US Agents Are Using 'Wellness Checks' on Children as a Prelude to Arrests LA Homelessness Drops for Second Year Manhattan, Chicago Murder Rates Drop in 2025, Officials Say Then, very suddenly, that all changed. Late on Monday, the chipmaker said it received assurances that the US government would allow it to export some chips to the Asian nation. Advanced Micro Devices Inc., Nvidia's chief rival, quickly followed with a similar announcement. These export license approvals could generate billions of dollars in total revenue for the companies this year — and they mark a dramatic reversal after the Trump administration said the issue wasn't even up for debate. Huang has taken almost every opportunity available to him — from the stage of tech events to Washington visits — to argue that a crackdown on China is counterproductive. During his appearances, he navigated a fine line between praising Trump policies aimed at bringing back chip manufacturing to the US and demanding more freedom to do business in China. Just last week, Huang met with President Donald Trump at the White House. 'Jensen has done a wonderful job at advocating to the administration,' said Matthew Bryson, an analyst at Wedbush Securities. The CEO has catered to the White House's interest in investing in the US, 'while at the same time advocating his views on the importance that US AI should flow freely,' he said. When Nvidia announced its plans to reenter the China market, Huang was visiting Beijing, attending a government-sponsored event and meeting officials to discuss 'safe and secure AI for the benefit of all,' according to a company statement. Nvidia said it was assured that licenses would be granted by the US government and 'hopes to start deliveries soon.' 'It is a positive signal not only for Nvidia and its related supply chain but also for broader markets given its implications for US-China trade talks,' said Richard Clode, portfolio manager at Janus Henderson Investors. Still, there's no guarantee the new approvals will lead to flourishing business in China. Nvidia and AMD aren't certain how many chips the new export licenses will cover or how long they will last, according to a person familiar with the matter. In China, the US chipmakers are only permitted to sell older, limited versions of their products. And many buyers in the country, where companies are rapidly churning out AI models, have moved to local suppliers. Washington officials have assured Huang they will move rapidly on granting the first batch of licenses. Nvidia's order pipeline was solid, he added. 'We have to wait until the licenses come through,' Huang said at a high-profile Chinese government-backed conference in Beijing on Wednesday. 'I've been assured that the licenses will move very fast.' It's also not clear how much Huang's lobbying turned the tide. The concession was part of broader US negotiations with China, which the White House said will accept higher tariffs and cooperate on rare-earth minerals. 'Senior administration officials are pretty clearly characterizing this as having been explicitly traded for what we got in those talks,' said Tobin Marcus, head of US policy and politics at Wolfe Research. Huang has argued that restrictions in China mean American chipmakers will cede the immense market to local rivals, chiefly Huawei Technologies Co. White House AI adviser David Sacks has echoed that, calling for an American 'tech stack' — a set of complementary hardware and software services that the nation can export and control. Sacks, a tech entrepreneur and venture capitalist, was critical in reversing recent semiconductor restrictions to Saudi Arabia and the United Arab Emirates, arguing that the Gulf powerhouses would otherwise turn to China for their growing AI ambitions. 'We are not selling the latest and greatest chips to China,' Sacks said in a Bloomberg Television interview on Tuesday. 'The policy is nuanced, and it makes a lot of sense.' But there's another contingent who view chip bans as a key way to keep Beijing from advancing in what's widely seen as an AI arms race. The abrupt about-face this week came as a shock to many China hawks in the administration and on Capitol Hill, leaving several privately fuming, people with knowledge of the matter said. Many policymakers were in the dark on how the changes will be implemented and raced to get a better understanding of the mechanics, said these people, who asked not to be identified because they aren't authorized to speak publicly on the matter. The House select committee on China plans to seek clarification from the Commerce Department on the reversal, according to the panel's Republican chairman, Representative John Moolenaar. 'It is crucial that the US maintain its lead' and keeps advanced AI out of the hands of the Chinese Communist Party, he said in a statement. US Commerce Secretary Howard Lutnick told CNBC that the policy change makes sense because Nvidia and AMD won't be selling their latest chips in the market. 'We want to keep having the Chinese use the American technology. They still rely upon it, and that's key,' he said. 'So we try to play that balance. We don't sell them our best stuff.' The US first restricted Nvidia's sales in China in 2022, placing curbs designed to keep the most advanced AI resources from the Chinese military. In response, Nvidia designed new processors, including the H20. It's an AI accelerator with certain components — such as memory access — deliberately limited to comply with US bans. Officials under President Joe Biden weighed the idea of placing restrictions on the H20 but ultimately didn't. Trump then went ahead with the curbs in April, citing national security concerns. A month later, Huang said the US government was shooting itself in the foot with the policy. 'All in all, the export controls were a failure. The facts would suggest it,' he told reporters in Taipei. He also said demand in China for AI chips would reach $50 billion in 2026 — a market that Trump basically kept his company out of. Nvidia's products are central to the creation and running of artificial intelligence software. The company has more than a 90% share in AI accelerators — chips that are the key component in giant data centers being built around the world. Access to the chips has become a negotiating card for Trump during his trips to the Middle East, where he secured massive pledges from Gulf states to invest in the US. Along the way, he's praised Huang for going further than some other tech CEOs, such as Apple Inc.'s Tim Cook. During a trip to Riyadh, Saudi Arabia, Trump scanned the crowd for the tech luminaries who joined him for an event. He spotted Huang. 'Thank you very much, Jensen. I mean, Tim Cook isn't here. But you are,' the president said. 'What a job you've done.' --With assistance from Laura Avetisyan, Brunella Tipismana Urbano, Alicia Diaz, Lucille Liu and Jessica Sui. (Updates with Huang's comments from Beijing in the 9th paragraph.) Forget DOGE. Musk Is Suddenly All In on AI How Starbucks Is Engineering a Turnaround With Warm Vibes and Cold Foams How Hims Became the King of Knockoff Weight-Loss Drugs Thailand's Changing Cannabis Rules Leave Farmers in a Tough Spot The New Third Rail in Silicon Valley: Investing in Chinese AI ©2025 Bloomberg L.P. 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Business Insider
11 minutes ago
- Business Insider
AMD Stock Soars as Trump Lifts China AI Chip Ban
Advanced Micro Devices (AMD) stock rallied on Tuesday after President Donald Trump lifted his ban on artificial intelligence (AI) chip sales to China. The latest reports claim that AMD has gained permission to sell its MI308 chips to Chinese customers, despite concerns that this would benefit the country's military and AI sectors. Elevate Your Investing Strategy: Take advantage of TipRanks Premium at 50% off! Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence. Make smarter investment decisions with TipRanks' Smart Investor Picks, delivered to your inbox every week. Investors will note that the Commerce Department hasn't yet confirmed the lifting of the ban on sales of AI chips to China. However, AMD rival Nvidia (NVDA) has confirmed its ability to sell H20 chips to customers in the country. President Trump's reversal of the AI chip ban is likely tied to ongoing pressure from the tech industry. Nvidia CEO Jensen Huang has been among the figures who have publicly called on the U.S. President to relax restrictions around AI chip sales to China. It appears President Trump has taken that advice. AMD Stock Movement Today AMD stock was up 6.64% on Tuesday morning, extending a 29.15% rally year-to-date. However, the shares have still fallen 17.53% over the past 12 months. Today's news comes with strong trading of AMD stock, with some 44 million shares having changed hands. This is closing in on the semiconductor company's three-month daily average trading volume of roughly 48.49 million shares. In related news, AMD stock received updated coverage from five-star Bernstein analyst Stacy Rasgon today. Rasgon reiterated a Hold rating and $95 price target, suggesting a 39.3% downside for the shares. Is AMD Stock a Buy, Sell, or Hold? Turning to Wall Street, the analysts' consensus rating for AMD is Moderate Buy, based on 25 Buy and 10 Hold ratings over the past three months. With that comes an average AMD stock price target of $135.97, representing a potential 13.37% downside for the shares.
27 minutes ago
Asian shares are mixed after Nvidia nudges Nasdaq to a record, while other US stocks slump
BANGKOK -- Shares in Asia traded mixed on Wednesday after an update on U.S. inflation pulled most Wall Street stocks lower, though gains for Nvidia pushed the Nasdaq to another record. Tokyo's Nikkei 225 edged less than 0.1% lower, to 39,663.40. Investors are focusing on the potential impact of an election for the Upper House of Parliament on Sunday that is expected to lead to tax cuts and higher spending as lawmakers try to restore the waning popularity of the ruling Liberal Democrats. Worries over a deterioration in Japan's fiscal health have pushed yields of long-term Japanese government bonds to their highest levels in years. 'What's at stake isn't simply which party hands out the biggest bundle of goodies. It's whether the walls holding up Japan's house of debt can withstand another round of fiscal fireworks…' Stephen Innes of SPI Asset Management said in a commentary. Elsewhere in Asia, Hong Kong's Hang Seng added 0.1% to 24,618.23 while the Shanghai Composite index slipped 0.1% to 3,503.78. South Korea's Kospi lost 0.9% to 3,186.38 and in Australia, the S&P/ASX 200 declined 0.8% to 8,561.80. Taiwan's Taiex jumped 0.9% and India's Sensex was flat. Thailand's SET also was little changed. In Jakarta, shares rose 0.4% after President Donald Trump said on Truth Social that he plans to tariff imports from Indonesia at 19%, while American goods sent to the Southeast Asian country will face no tariffs. Trump also said Indonesia committed to buying U.S. energy, agricultural products and aircraft. On Tuesday, the S&P 500 fell 0.4% to 6,243.76, but stayed near its all-time high set last week, as 90% of the stocks within the index fell. The Dow Jones Industrial Average dropped 1% to 44,023.29. The Nasdaq composite rose 0.2% to a record 20,677.80 thanks to Nvidia, the market's most influential stock. Nvidia said the U.S. government has assured it that licenses will be granted for its H20 chip, used for artificial intelligence, again and that deliveries will hopefully begin soon. Its 4% gain was by far the strongest force pushing upward on the S&P 500. Stocks of big U.S. banks were mixed following their latest profit reports. JPMorgan Chase slipped 0.7% despite reporting a stronger profit than analysts expected, as CEO Jamie Dimon warned of risks to the economy because of tariffs and other concerns. Citigroup rose 3.7% following its better-than-expected profit report. But Wells Fargo fell 5.5% following its own, as it trimmed its forecast for an important way that it makes money. A report showed inflation in the United States accelerated to 2.7% last month from 2.4% in May as prices rose for clothes, toys and other goods that usually are imported. Economists say prices may be rising because of stiff tariffs that President Donald Trump has proposed on other countries. Treasury yields yo-yoed after the report and then began rising. The yield on the 10-year Treasury climbed to 4.48% from 4.43% late Monday. The yield on the two-year Treasury, which more closely tracks expectations for what the Federal Reserve will do with short-term interest rates, rose to 3.95% from 3.90%. Higher inflation could inhibit interest rate cuts by the Fed. It has been keeping rates on hold this year after cutting them at the end of last year. That's because lower rates can give inflation more fuel, along with a boost for the economy. Wall Street loves lower rates because they goose prices higher for stocks and other investments, and Trump himself has been clamoring for the Fed to cut more quickly. Fed Chair Jerome Powell, though, has been adamant that he wants to wait for more data about how tariffs affect the economy and inflation. Following Tuesday's inflation report, traders are still overwhelmingly betting that the Fed will cut its main interest rate by the end of the year. But they pulled back their bets on the number of potential cuts, according to data from CME Group. In other dealings early Wednesday, U.S. benchmark crude oil picked up 42 cents to $66.94 per barrel. Brent crude, the international standard, was up 30 cents at $69.01 per barrel. The dollar fell to 148.66 Japanese yen from 148.87 yen. The euro was at $1.1627, up from $1.1602.
