NEW YORK: The tech-heavy Nasdaq edged higher in choppy trade on Thursday, held back by a fall in Nvidia’s shares as Sino-US trade uncertainties prompted the AI chip giant to exclude potential China sales from its quarterly forecast.
The exclusion came despite the company having secured certain licenses earlier this month to sell its H20 chips to major market China, after reaching a revenue-sharing deal with the US government.
Nvidia’s shares were last down 1.3 percent in volatile trade, as some analysts also raised concerns about whether the company’s data center results hinted at tighter spending by cloud providers.
Still, Nvidia’s strong quarterly revenue forecasts, USD60 billion share buyback plan and CEO Jensen Huang’s upbeat comments placated investor concerns around artificial intelligence demand.
“(China) is a big part of their business and until that’s resolved, there’s going to be a bit of an overhang on what they can do in terms of guidance and what they can project in terms of growth,” said Thomas Hayes, chairman at Great Hill Capital.
The enthusiasm around AI was the driving force behind Wall Street’s nearly three-year bull-market run. The rally has survived multiple hiccups this year, including the unveiling of cheaper Chinese AI models and the US tariff-induced selloff in April.
Semiconductor peer Super Micro Computer fell 1.1 percent, while Broadcom rose 2.5 percent, helped by brokerage Oppenheimer’s price target raise. Major customers of Nvidia, including Meta and Microsoft, were marginally higher.
The broader S&P 500 technology sector gained 0.2 percent and the chip index rose 0.3 percent.
Data analytics company Snowflake gained 17.8 percent after raising its forecast for fiscal 2026 product revenue, citing AI demand. HP Inc rose 2.4 percent after beating quarterly revenue estimates on growing demand for AI-powered personal computers.
At 11:44 a.m. ET, the Dow Jones Industrial Average fell 35.70 points, or 0.08 percent, to 45,529.53, the S&P 500 gained 0.57 points, or 0.01 percent, to 6,481.97 and the Nasdaq Composite gained 46.98 points, or 0.22 percent, to 21,637.12.
The other dominant theme behind the benchmark S&P 500’s rise to record highs has been expectations that the Federal Reserve could lower interest rates for the first time this year in September.
Traders are pricing in an 88.8 percent chance of a rate-cut next month, according to data compiled by LSEG.
Placating worries of a slowing economy, weekly jobless claims were lower than expected, while a separate report showed corporate profits rebounded in the second quarter.
The spotlight is now on Friday’s Personal Consumption Expenditures data, and any signs of inflation increasing could temper expectations for a September rate cut.
Also on Thursday, Fed Governor Lisa Cook filed a lawsuit challenging US President Donald Trump attempt to remove her from office earlier this week.
Coming later in the day are remarks from Fed Governor Christopher Waller, who is perceived as dovish and among the candidates being considered to replace Fed Chair Jerome Powell next year.