US stock market today: S&P 500, Nasdaq, Dow Jones end in red, all eyes on Nvidia earnings results
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U.S. stock indexes closed lower on Wednesday as investors digested minutes from the last Federal Reserve meeting and awaited results from AI bellwether Nvidia. Nvidia and Salesforce reports are due after the closing bell.S&P 500 lost 31.59 points, or 0.53 per cent, to end at 5,889.95 points, while the Nasdaq Composite lost 91.27 points, or 0.47 per cent, to 19,107.89. The Dow Jones Industrial Average fell 237.24 points, or 0.56 per cent, to 42,106.41.The S&P 500 is still down from its record closing high, reached on February 19. It fell as much as 18.9 per cent below that level in the wake of Trump's erratic tariff announcements that have whipsawed markets for much of his second term.A poll of strategists and analysts conducted by Reuters showed that many market participants expected the benchmark index to finish the year near current levels.Shares of sportswear retailer Dick's Sporting Goods gained after its first-quarter results beat estimates.A1. Key indexes of US Stock market are S&P 500, Nasdaq, and Dow Jones.A2. Nvidia results will be out on Wednesday at 5 pm (ET).
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Indian Express
24 minutes ago
- Indian Express
How US President Trump's restrictions on AI chip sales to China affect Nvidia
Nvidia has said it expects tighter US export controls on its China-bound AI chips to wipe out $8 billion in sales in the coming quarter, even as the chip giant reported strong earnings and revenue for the first quarter of its fiscal year 2026, which ended on April 27. The US-based chip designer recorded year-over-year (YoY) growth of 73 per cent driven by surging demand in other global markets. Nvidia shares rose by 6 per cent the day after it reported earnings on Wednesday, May 28. The company reported revenue of $44.06 billion for the quarter, up by 69 per cent YoY, beating analyst estimates of $43.3 billion. Nvidia further said it expects about $45 billion in sales in Q2 FY26. Nvidia's quarterly report has allayed fears among investors that demand for its Graphics Processing Units (GPUs), used to train and deploy AI models like OpenAI's o3, is slowing down. The company's quarterly earnings were also closely watched by the tech industry for clues on how growing uncertainty from US President Donald Trump's tariff policies and export restrictions on AI chips to China, will affect Nvidia's international business. China is a key market for Nvidia, accounting for 13 per cent of its sales in the past financial year. In a bid to maintain its lead in the high-stakes AI race, the US government has sought to prevent the most advanced chips from being sold in China by tightening export rules. While Chinese competitors still lag behind Nvidia's cutting-edge chip design technology, several analysts have warned that the gap is narrowing. They have pointed out that US efforts to curb China's access to advanced semiconductors have not been successful due to loopholes and existing chip stockpiles in China. Some have even argued that the restrictions have counter-intuitively intensified competition against one of America's most valuable companies while cutting off access to a key growth market. The H20 processor was specifically designed by Nvidia to comply with existing limits by the US government. Chinese AI startup DeepSeek's R1 model is believed to be powered by a mixed stack of Nvidia's H800, H100, and H20 GPUs. Following the debut of DeepSeek's low-cost, compute-efficient AI model, several Chinese companies including Tencent, Alibaba, and TikTok parent ByteDance reportedly ramped up orders for H20 chips. The H20 is not Nvidia's most advanced chip and was primarily designed to get as close as possible to US export limits. However, it reportedly offers the same compute as advanced chips for a crucial step in developing large language models (LLMs) known as inference. This process involves running an LLM on previously seen data to identify the patterns it has learnt after the training stage. During the first quarter of fiscal 2026, the Trump administration reportedly told Nvidia that the H20 chip would require a separate export licence to be sold in China. Besides the expected $8 billion hit, Nvidia said it incurred $4.5 billion in charges related to excess inventory for the H20 chip. If not for the China-related charge, Nvidia said its gross margin of 61 per cent for the quarter would have been 71.3 per cent. Extra sales worth $2.5 billion would have been recorded in the reported quarter too, the company added. Notably, US export restrictions on chip sales to China show no signs of easing. The Trump administration has also ordered more companies, including firms that develop design software for semiconductors, to stop selling to China in the absence of a licence, according to a report by Reuters. In an earnings call on Wednesday, Nvidia CEO Jensen Huang told investors that the $50 billion market in China for AI chips is 'effectively closed to US industry.' 'The H20 export ban ended our Hopper data center business in China. We cannot reduce Hopper further to comply. As a result, we are taking a multibillion-dollar write-off on inventory that cannot be sold or repurposed. We are exploring limited ways to compete, but Hopper is no longer an option. China's AI moves on with or without US chips,' Huang said. Speaking at the annual Computex tech trade show held in Taiwan earlier this month, Huang said that Nvidia's market share in China had fallen from 95 per cent to 50 per cent over the past four years. However, on the earnings call, he also said that global demand for Nvidia's AI infrastructure was still going strong. 'Countries are racing to build national AI platforms to elevate their digital capabilities,' Huang added. The Trump administration has also rescinded the AI diffusion rule which was introduced by former US President Joe Biden at the start of the year. This rule essentially limited the number of US-made AI chips that could be sold in international markets, including India, without special approval by the US government. Nvidia and other US chip designers have long been lobbying against export controls to China as they fear losing out on a key market. Meanwhile, the success of DeepSeek and reports of Huawei's chip progress have led many to question the effectiveness of US-imposed chip controls. But even as these restrictions become more stringent, Nvidia's business is not likely to struggle as it continues to sell to major hyperscalers like Meta and Microsoft. 'On average, major hyperscalers are each deploying nearly 1,000 NBL72 racks, or 72,000 Blackwell GPUs per week, and are on track to further ramp output this quarter,' Colette Kress, the chief financial officer of Nvidia, said on the call. It is also reducing its reliance on big tech buyers by supplying for national AI initiatives such as the recently announced 500-megawatt AI infrastructure project in Saudi Arabia and a 5-gigawatt AI campus in the UAE under the US-led Stargate Project. 'Sovereign AI is a new growth engine for NVIDIA Corporation,' Huang said on the earnings call. Nvidia's net income rose by 26 per cent to $18.8 billion, up from $14.9 billion a year earlier. Sales from AI chips and related parts accounted for 88 per cent of the company's total revenue. Nvidia further said that half of the revenue from its data center business was from large cloud providers while the company's network products, commonly used to connect stacks of chips for AI research, saw $5 billion in sales. Meanwhile, the company's gaming division saw 42 per cent growth YoY to $3.8 billion. Besides being essential for AI development, Nvidia's chips are also used for gaming applications. The upcoming Nintendo Switch 2 gaming console will also be powered by a processor designed by Nvidia. Besides export controls, Nvidia shareholders were also focused on the company's rollout of its new GB200 NVL72 'thinking machines' that comprise 72 Blackwell GPUs and cost around $3 million, according to a report by TechCrunch. These systems are specially designed for reasoning. The new hardware began shipping in February this year, soon after the disruption caused by the launch of DeepSeek's R1. Many analysts had estimated that the chaos around DeepSeek would reduce the unit's estimated shipments by half. In its results, the company highlighted strong momentum in Blackwell-based systems as the GB200 NVL72 machines ramped to full-scale production during the quarter 'across system makers and cloud service providers.' 'Microsoft, for example, has already deployed tens of thousands of Blackwell GPUs and is expected to ramp to hundreds of thousands of GB200s with OpenAI as one of its key customers,' Nvidia CFO Colette Kress said on the call.
Time of India
24 minutes ago
- Time of India
Donald Trump rages against court ruling on tariffs, calls on Supreme Court to act quickly
US President Donald Trump US President Donald Trump wrote a fiery post on social media on Thursday night after a federal court ruling challenged the legality of his proposed tariffs, criticising the judiciary and taking aim at prominent conservative legal figures. The controversy stems from a recent decision by the US court of international trade, which on Wednesday ruled that Trump had exceeded his authority under the International Emergency Economic Powers Act (IEEPA) in attempting to implement new tariffs. However, a day later, the US court of appeals for the federal circuit issued a temporary stay, allowing the tariffs to remain in place for now. Reacting to the development on Truth Social, Trump blasted the court of international trade's ruling as 'incredible' and politically motivated. 'Where do these initial three Judges come from?' Trump wrote. 'Is it purely a hatred of 'TRUMP?' What other reason could it be?' In a striking departure from usual Republican rhetoric, Trump also lashed out at the Federalist Society, a conservative legal group influential in shaping his judicial nominations during his presidency. He specifically targeted Leonard Leo, co-chairman of the organisation's board, accusing him of giving 'bad advice' and harbouring personal ambitions. 'It was suggested that I use The Federalist Society as a recommending source on Judges,' Trump posted. 'I did so, openly and freely, but then realized that they were under the thumb of a real 'sleazebag' named Leonard Leo, a bad person who, in his own way, probably hates America.' by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like गुड़गांव में बिक्री के लिए 3बीएचके फ्लैट (कीमतें जांचें) 3BHK Flat For Sale | Search Ads और जानें Undo Disappointment in judicial picks Trump expressed frustration over some of the judges he appointed while in office, blaming the Federalist Society for pushing names that he now regrets. 'I am very proud of many of our picks, but very disappointed in others,' he wrote. 'They always must do what's right for the Country!' Tariffs and legal battle continue Trump concluded his lengthy post by reiterating support for his proposed tariffs, which he insists are crucial for America's economic security. 'The ruling by the US Court of International Trade is so wrong, and so political!' he declared, expressing hope that the Supreme Court would overturn the decision 'quickly and decisively.' 'The President of the United States must be allowed to protect America against those that are doing it Economic and Financial harm,' he added.
Mint
25 minutes ago
- Mint
President Trump isn't a tariff king
In a ruling heard 'round the world, the U.S. Court of International Trade on Wednesday blocked President Trump's sweeping tariffs. This is an important moment for the rule of law as much as for the economy, proving again that America doesn't have a king who can rule by decree. The Trump tariffs have created enormous costs and uncertainty, but now we know they're illegal. As the three-judge panel explains in its detailed 52-page ruling, the President exceeded his emergency powers and bypassed discrete tariff authorities delegated to him by Congress. The ruling erases his April 2 tariffs as well as those on Canada and Mexico. Small businesses and several states (V.O.S. Selections v. U.S.) challenged Mr. Trump's use of the 1977 International Emergency Economic Powers Act (IEEPA) to impose tariffs willy-nilly. That law gives the President broad authority in a national emergency to 'deal with any unusual and extraordinary threat" including to 'regulate" the 'importation" of foreign property. After declaring fentanyl an emergency, the President in February slapped tariffs on Mexico, Canada and China. Then in April he deemed the U.S. trade deficit an emergency and imposed tariffs of varying rates on the world. He later reduced those to 10% across the board for 90 days, supposedly to allow time to negotiate trade deals. No other President has used IEEPA to impose tariffs. As the trade court explains, Richard Nixon used the law's precursor, the Trading With the Enemy Act, in 1971 to impose 10% tariffs for a short period to address a balance of payments problem. The Justice Department said Mr. Trump's tariffs are no different. Not so. As the panel notes, Nixon tariffs were upheld by an appeals court because they were a 'limited surcharge" and 'temporary measure calculated to help meet a particular national emergency, which is quite different from imposing whatever tariff rates he deems desirable." The latter is what Mr. Trump did, at one point jacking up rates to 145% on China. Congress also limited the President's emergency powers in IEEPA to prevent overreach. 'The legislative history surrounding IEEPA confirms that the words 'regulate . . . importation' have a narrower meaning than the power to impose any tariffs whatsoever," the panel notes. Mr. Trump invoked IEEPA because he wanted to impose tariffs as he sees fit. But the Constitution doesn't let the President ignore Congress and do whatever he wants. 'Under the major questions doctrine, when Congress delegates powers of 'vast economic and political significance,' it must 'speak clearly,'" the judges stress. Democrats panned the major questions doctrine when the High Court used it to block Joe Biden's student-loan forgiveness, but perhaps they will now see its wisdom. The judges also say Mr. Trump's fentanyl tariffs are unlawful because they don't, as IEEPA requires, 'deal with" their stated objectives. The government's theory would permit 'any infliction of a burden on a counterparty to exact concessions," the panel notes. 'If 'deal with' can mean 'impose a burden until someone else deals with,' then everything is permitted." Exactly. The court's ruling effectively slams the door on IEEPA as a basis to impose tariffs. This means a future Democratic President can't declare a climate emergency and wield tariffs to punish countries for CO2 emissions. Conservatives ought to cheer this restraint on one-man rule. White House officials are attacking the trade court's ruling as liberal judicial overreach, though the three judges were Reagan, Obama and Trump appointees. On Thursday the U.S. Court of Appeals for the Federal Circuit put a stay on the trade court's ruling while it considers Mr. Trump's emergency appeal. Meanwhile, a separate federal judge also ruled the tariffs illegal under IEEPA. The White House boasts it will win at the Supreme Court, but our reading of the trade court's opinion suggests the opposite. Mr. Trump's three Court appointees are likely to invoke the major-questions precedent. Mr. Trump has other laws he can use to impose tariffs, though most are more limited than his emergency claims. The most expansive is Section 338 of the 1930 Smoot-Hawley Act, which lets a President impose duties up to 50% on countries found to discriminate against the U.S. But no President has ever done so. Mr. Trump would be wiser to heed the trade court's ruling as the political gift it is and liberate his Presidency and the economy from his destructive tariff obsessions.
