Top Democrat on US House China committee open to Nvidia H200 sales | ReutersSkip to main content[Exclusive news, data and analytics for financial market professionalsLearn more aboutRefinitiv]Item 1 of 2 U.S. Representative Ro Khanna (D-CA) speaks during a press conference on the Epstein Files Transparency Act ahead of a House vote on the release of files related to the late convicted sex offender Jeffrey Epstein, on Capitol Hill in Washington, D.C., U.S., November 18, 2025. REUTERS/Annabelle Gordon[1/2]U.S ...

Core Viewpoint - The relationship between Nvidia and China is reportedly improving, with the Chinese government allowing major companies like Alibaba to purchase Nvidia's chips [1] Group 1: Regulatory Approval - Chinese regulators have granted in-principle approval for Alibaba, Tencent Holdings, and ByteDance to proceed with preparations for purchasing Nvidia's H200 chips [1]

Financial Sector - The financial sector experienced a significant downturn following President Trump's announcement of a one-year cap of 10% on credit card interest rates, effective January 20, 2026, aimed at protecting consumers from high rates averaging around 20% [2][3] - Major financial institutions like JPMorgan Chase, Bank of America, Citigroup, and Wells Fargo saw their stock prices drop significantly, with JPMorgan's shares falling 4.2% to $310.90 despite better-than-expected earnings [3][4] - Consumer finance firms specializing in credit cards faced even steeper declines, with drops between 8% and 11% for companies like Synchrony Financial and Capital One, while Visa and Mastercard also saw declines of over 2% [4] Semiconductor Industry - A trade deal between the U.S. and Taiwan resulted in a reduction of tariffs on Taiwanese goods from 20% to 15%, in exchange for Taiwan's commitment to invest $250 billion in U.S. semiconductor and AI sectors [6][7] - Taiwan Semiconductor Manufacturing Co. reported a 35% year-over-year increase in fourth-quarter profit, leading to a 4.5% surge in its U.S.-listed shares, with trading volume increasing by 159% [7] - Despite a new 25% tariff on specific high-end AI chips, Nvidia's stock rebounded by around 3% due to positive earnings from TSMC and exemptions for companies investing in America [8][9] Healthcare Sector - President Trump introduced "The Great Healthcare Plan" aimed at lowering prescription drug prices and insurance premiums, but the lack of details and the need for Congressional approval left the market skeptical [10] - Some healthcare stocks like UnitedHealth Group and Cigna saw modest gains, but the overall market impact was minimal due to concerns over rising premium costs for millions of Americans [10] Geopolitical Developments - President Trump's announcement of a "Board of Peace" in Gaza and withdrawal from 66 global organizations had little immediate market impact, overshadowed by economic news [11] - Oil prices dropped approximately 5% following Trump's de-escalation of military threats against Iran, indicating a positive market reaction to reduced geopolitical tensions [11] Market Volatility - The week illustrated the unpredictable nature of the market under Trump's administration, characterized by sudden policy announcements and immediate market reactions, creating a challenging environment for investors [12]

Core Viewpoint - The recent updates regarding semiconductor tariffs may indicate a potential reopening of the Chinese market for companies like Nvidia and AMD [1] Group 1: Company Impact - Nvidia's stock price increased by 2.06% following the news [1] - Advanced Micro Devices (AMD) saw a stock price rise of 1.87% in response to the developments [1] Group 2: Industry Context - The discussion centers around the implications of new semiconductor tariffs on the AI sector and related stocks [1]

Group 1 - The Trump administration has announced a 25% tariff on certain advanced AI semiconductors, including Nvidia's H200 chips, which are set to ship to China [1] - The U.S. Department of Commerce has approved Nvidia to start shipping H200 chips to vetted customers in China, despite the tariffs [2] - Nvidia expressed support for the decision, highlighting the balance it strikes for the American chip industry and the demand for H200 semiconductors from Chinese companies [3] Group 2 - The Chinese government is drafting regulations on semiconductor imports, which may allow for the purchase of Nvidia's chips, indicating a potential shift in its stance on chip imports [7] - China aims to enhance its domestic semiconductor industry while not falling behind in the global AI race [6] - The U.S. currently manufactures only about 10% of the chips it requires, indicating a heavy reliance on foreign supply chains, which poses economic and national security risks [8][9]

Two senior Democratic lawmakers on Monday asked the U.S. Commerce Department to disclose details and any approvals of ongoing license reviews for potential sales to Chinese firms of Nvidia's second-mo... ...

The US approval for Nvidia's H200 artificial intelligence processors will give China a much-needed boost in computing power rather than pose a direct threat to domestic chips, even though the US chip is more powerful than rivals from Huawei Technologies and Moore Threads, according to analysts. With a total processing performance (TPP) of 15,832, the H200 has surpassed all AI chips made by domestic vendors on the market so far as well as Nvidia's H20, which was previously the most advanced Nvidia processo ...

Group 1 - China is considering a substantial package of incentives worth up to $70 billion to support its chipmaking industry, reflecting its strategic focus on technological independence amid US-China tensions [1][2] - The proposed incentives range from 200 billion yuan ($28 billion) to 500 billion yuan, with final details still being negotiated [2] - This initiative aims to bolster domestic companies like Huawei Technologies and Cambricon Technologies, reducing reliance on foreign chipmakers such as Nvidia [3][4] Group 2 - The scale of the proposed incentives is significant, potentially making it the largest state-backed semiconductor support program to date, as countries globally seek to secure local semiconductor production [4] - The Chinese government is adopting a "whole-nation" approach to enhance semiconductor capabilities, driven by concerns over access to US technology due to export restrictions [6] - The focus on semiconductors and AI has led to increased fortunes for firms across the supply chain, indicating a robust growth trajectory in the industry [7]

Core Insights - The company reported a strong performance for Q4 and FY26, indicating a combination of growth in both top and bottom lines despite challenges faced in Q3 due to China restrictions [1] - The company is taking a pragmatic approach to its guidance for FY26, assuming no significant changes in the Chinese market, which had previously seen a decline of over 20% in FY25 [5][6] - The increasing investment in chip design globally, particularly in the US, South Korea, and Europe, is expected to provide a positive tailwind to offset the challenges in China [6] Company Performance - The company experienced a significant impact on its IP business due to a six-week sales halt to China, which affected Q3 results [1] - The guidance for FY26 does not factor in any potential recovery in the Chinese market, reflecting a cautious outlook [6] Market Dynamics - The company is observing a competitive landscape in China, where local companies are developing alternative chips, limiting the company's ability to sell to certain clients [4] - The endorsement of Nvidia's technology is seen as a validation of the company's direction towards integrating AI with semiconductor design, which is expected to drive future growth [9] Strategic Initiatives - The acquisition of ANC is anticipated to enhance the company's capabilities in creating digital twins, which will facilitate more sophisticated product designs and reduce costs [7][8] - The shift towards AI-powered products in various industries, including automotive and aerospace, is creating significant opportunities for the company to leverage its semiconductor and software solutions [8][9]

Core Insights - Nvidia has received approval to export H200 AI chips to China, with the U.S. government imposing a 25% fee on sales, an increase from the previously set 15% [2][3] - The H200 chip is significantly more powerful than the H20 model, which Nvidia had previously been limited to exporting [3] - Analysts are cautiously optimistic about the potential revenue impact, estimating an annual increase of $25 to $30 billion and an EPS impact of $0.60 to $0.70 [4] Revenue Impact - Nvidia reported export control impacts of approximately $4.6 billion in Q1 and $4 billion in Q2, with China historically accounting for 20-25% of its data center revenue [3] - Wells Fargo maintains an overweight rating on Nvidia, with a price target of $265, significantly above the current trading price of $184 [5] Market Reactions - Analysts from William Blair believe the new chip approvals could positively influence Nvidia's fiscal 2027 revenue expectations, but they are awaiting evidence of actual orders from China before adjusting forecasts [8] - Concerns remain regarding the approval process for Chinese customers and the management of the 25% revenue fee to the U.S. government [6] Competitive Landscape - AMD and Intel are also expected to benefit from the new export policies, with AMD already holding a license for its MI308X chip [7] - AMD's revenue guidance was previously cut by about $700 million for Q2 and $1.5 billion for the year due to export restrictions [7]