Nvidia Stock Drops 5.7% Amid AI Chip Export Restrictions

Nvidia's stock experienced a significant decline following the company's warning that new U.S. export restrictions on its AI chips to China could cut billions from its revenue, sparking broader market volatility. The restrictions, aimed at curbing China's access to advanced technology for national security reasons, are expected to impact Nvidia's H20 chips and could result in an estimated $5.5 billion loss from its quarterly results. This development has unsettled investors, contributing to declines across major indexes and dragging down other semiconductor stocks such as AMD and ASML. The situation is further complicated by escalating U.S.-China trade tensions and bipartisan political support for tightening tech export controls. These factors have heightened uncertainty for both the tech sector and the global economy, with market sentiment shifting in response to Nvidia's pivotal role in AI and semiconductor industries. The ripple effects extend beyond equities, as volatility in Nvidia's stock price has also influenced AI-related cryptocurrencies and led investors to adjust their portfolios amid the ongoing geopolitical and regulatory headwinds.