The TikTok deal could be a blueprint for thawing tense U.S.-China relations, says Plexo's Lo Toney

US-China Tech Relationship & Geopolitics - China's internet regulator has ordered tech giants to halt purchases of Nvidia AI chips, including a new China-specific chip [1] - The TikTok deal could serve as a blueprint for easing US-China tensions, with everything potentially on the bargaining table [3][4] - The US administration is deal-oriented and aims to reach an agreement on TikTok, potentially allowing for face-saving measures [5] - Policy decisions regarding technology, especially AI, are crucial for national defense and maintaining US leadership [11][12] - Finding a balance between allowing companies to compete and monitoring potential consequences is essential [15] Nvidia & AI - Nvidia continues to support the Chinese government and companies [2] - AI adoption is driving growth at both the infrastructure layer (e.g, Nvidia) and the model layer (e.g, Anthropic, OpenAI) [9] - The key question is whether the US wants China to excel in AI, considering the risk of them acquiring the technology regardless [10][11] Market & Economic Factors - Macro trends are generally favorable for the tech sector, driven by AI adoption [9] - Tech stocks are typically more volatile to interest rate changes due to their long-lived cash flows [7] - Potential Fed cuts and tax code changes could act as tailwinds for stocks [8]