Nvidia Reportedly Asks Suppliers to Halt H20 Work

Nvidia and H20 Chip - Nvidia reportedly asked component suppliers to halt H20 AI chip production after concerns from Beijing regarding security risks [1] - Chinese authorities raised alarms about potential security risks in the H20 chip, leading to local companies avoiding its use [1] - Nvidia has denied incorporating security backdoors into the H20 chip [2] Market Impact and Tech Stock Performance - Tech stocks were potentially due for a correction or sideways movement, and the Nvidia H20 situation may trigger profit-taking [3] - A minor correction in technology stocks is viewed as a healthy development [4] - The situation exemplifies the ongoing trade tensions between the United States and China [4] - The US Commerce Secretary suggested the H20 chip was an inferior product being sold to China, raising concerns in China [5] - A tech selloff is occurring, with investors taking profits, exemplified by Palantir losing over 70 billion USD in market share [6] - The market may experience further tech weakness into September, potentially bottoming out in October before a year-end rally [7] - The previous tech rally was driven by strong earnings from the Magnificent Seven, cloud providers, and chip providers [7] - High valuation multiples, such as a forward P/E of 30 for the Magnificent Seven, suggest the market may have become overvalued [8]