Nvidia stock (NVDA) rose 3.6% on Friday, buoyed by a Reuters report indicating that the Trump administration has begun its review of Nvidia’s H200 chip exports to China. The uptick in shares followed news that U.S. antitrust agencies had cleared Nvidia’s $5 billion investment in Intel (INTC), setting the stage for a potential weekly gain for the world’s largest chipmaker.
Investors reacted positively to the developments, interpreting them as a sign that President Trump may fulfill his commitment to permit Nvidia to sell advanced chips to China in exchange for a 25% fee to the government. This shift could significantly expand Nvidia’s access to a critical market, which the company has sought for months.
According to Reuters, the U.S. Commerce Department has forwarded license applications for the sale of Nvidia’s advanced chips to various government departments, including State, Energy, and Defense. These agencies are expected to provide input on the potential chip exports over the next 30 days, adding a layer of scrutiny to an already complex situation.
Despite the optimism surrounding the review, some analysts on Wall Street caution that lifting chip export restrictions to China may still face challenges. National security experts have raised concerns that granting China access to America’s cutting-edge chip technology could undermine the U.S.’s competitive edge in artificial intelligence. The interplay of economic opportunity and national security remains a contentious issue.
There is also uncertainty regarding whether China would accept the chips. Earlier this year, Trump imposed a ban on Nvidia’s H200 chips to China but reversed that decision in July. However, Chinese authorities cautioned local tech companies against purchasing the chips, citing national security worries.
Despite these hurdles, news of the Trump administration’s progress on chip export approvals sparked a rally among other chipmakers and developers, signaling a revival in broader tech trading. Nvidia’s stock not only benefited from the administration’s developments but saw additional gains following the Federal Trade Commission’s clearance of its investment in Intel, which in turn lifted Intel’s shares by 1%.
Other players in the semiconductor industry also experienced gains, with Advanced Micro Devices (AMD) climbing over 6.5%, Broadcom (AVGO) rising 3%, and Micron (MU) stock increasing by 7%. This bullish trend comes in the wake of a post-earnings buying spree after Micron’s stock surged 10% on Thursday.
The developments around Nvidia and its interactions with the U.S. government underscore the increasingly complex landscape of technology and international trade. As the market continues to react to these evolving narratives, companies will be closely monitoring regulatory changes, particularly in the context of trade relations with China.
As the situation unfolds, stakeholders in the semiconductor industry will be keenly observing how these regulatory reviews and market conditions may affect their strategic positioning. The ongoing dialogue regarding national security and technology access is likely to remain a focal point for both investors and policymakers.
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