Nvidia Faces Challenges Amid Sino-U.S. Trade Tensions
Nvidia faces a turbulent trading period as uncertainty mounts around its China sales due to Sino-U.S. trade tensions. Despite strong forecasts and a buyback plan, the AI chip giant's decision to exclude China from its quarterly forecast has impacted stock performance. Economic indicators hint at potential interest rate changes.
The Nasdaq faced a setback on Thursday due to a decline in Nvidia shares amid ongoing Sino-U.S. trade tensions. Nvidia excluded potential China sales from its quarterly forecast, leading to a 2.6% drop in its shares despite obtaining certain licenses to sell its H20 chips in China.
Concerns arose about Nvidia's data center results and possible reduced spending by cloud providers. The S&P 500 technology sector, which initially showed promise, fell by 0.5%, and the chip index declined 0.2%. However, Nvidia's $60 billion share buyback plan and optimistic comments by CEO Jensen Huang eased some investor worries.
Meanwhile, Snowflake and HP Inc saw gains due to anticipated AI demand. Expectations for a possible Federal Reserve rate cut buoyed the market, despite mixed economic signals. Jobless claims fell, and corporate profits rebounded, but inflation data could affect rate cut expectations.
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