China Launches Probe into Nvidia Amid Rising Trade Tensions
US equities declined on Monday, retreating from last week's gains amid geopolitical tensions, an upcoming Federal Reserve rate decision, and impending inflation data.
The S&P 500 and Nasdaq Composite indexes fell by 0.4% each by 2:15 pm ET.
Nvidia's share price decreased following reports of a Chinese investigation into the chipmaker for potential anti-monopoly law violations. This probe coincides with President Biden's recent expansion of semiconductor export restrictions to China aimed at limiting access to advanced AI technology.
In addition, China imposed bans on three rare minerals and new sanctions against US defense firms and executives, indicating an escalation in trade tensions ahead of Donald Trump's presidential inauguration. The Chinese government appears to be adopting a more aggressive stance compared to its previous response during Trump's first term.
Nvidia has not publicly commented on the investigation and has introduced a less powerful chip variant for the Chinese market following the new policies. Shares were down 2.4% as of 2:15 pm ET on Monday.