Despite Restrictions, Nvidia Chips Are Still Reaching China: WSJ
Portfolio Pulse from Anusuya Lahiri
Nvidia Corp (NASDAQ:NVDA) is under scrutiny as its advanced AI chips are reportedly being smuggled into China despite U.S. export restrictions. The underground market for these chips is thriving, with over 70 distributors advertising Nvidia’s restricted chips online. Nvidia sells its chips through third parties like Dell Technologies Inc (NYSE:DELL) and Super Micro Computer Inc (NASDAQ:SMCI). The U.S. government plans to extend its semiconductor technology embargo to Russia. Nvidia stock has gained over 189% in the last 12 months.
July 03, 2024 | 12:31 pm
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Nvidia is facing scrutiny as its advanced AI chips are reportedly being smuggled into China despite U.S. export restrictions. This could lead to increased regulatory pressure and potential impact on its stock price.
The news of Nvidia's chips being smuggled into China despite export restrictions could lead to increased regulatory scrutiny and potential penalties, negatively impacting the stock price in the short term.
CONFIDENCE 90
IMPORTANCE 90
RELEVANCE 100
NEUTRAL IMPACT
Dell Technologies, a third-party seller of Nvidia's chips, might face indirect scrutiny due to the smuggling reports. However, the impact on Dell's stock is likely to be minimal.
As a third-party seller of Nvidia's chips, Dell might face some indirect scrutiny, but the direct impact on its stock price is expected to be minimal.
CONFIDENCE 70
IMPORTANCE 40
RELEVANCE 50
NEUTRAL IMPACT
iShares S&P 500 Growth ETF, which includes Nvidia, might see minor fluctuations due to the smuggling reports. However, the overall impact on the ETF is expected to be minimal.
Given that IVW is a diversified ETF, the impact of Nvidia's smuggling reports on the ETF's overall performance is expected to be minimal.
CONFIDENCE 60
IMPORTANCE 30
RELEVANCE 30
NEUTRAL IMPACT
Super Micro Computer, another third-party seller of Nvidia's chips, might face indirect scrutiny due to the smuggling reports. The impact on SMCI's stock is likely to be minimal.
As a third-party seller of Nvidia's chips, Super Micro Computer might face some indirect scrutiny, but the direct impact on its stock price is expected to be minimal.
CONFIDENCE 70
IMPORTANCE 40
RELEVANCE 50
NEUTRAL IMPACT
Vanguard Information Tech ETF, which includes Nvidia, might see minor fluctuations due to the smuggling reports. However, the overall impact on the ETF is expected to be minimal.
Given that VGT is a diversified ETF, the impact of Nvidia's smuggling reports on the ETF's overall performance is expected to be minimal.
CONFIDENCE 60
IMPORTANCE 30
RELEVANCE 30