By Caitlin McCabe
The trade war is coming for two of the biggest names in the semiconductor industry-and that's unnerving markets.
Nvidia, the third-largest U.S. company by market value, warned late Tuesday that it will take a $5.5 billion charge after the U.S. said it will need a license to export H20 processors to China and other countries. These less-powerful AI chips had been designed to comply with American export controls.
The U.S. government confirmed the restrictions, and said it had put similar curbs on rival AMD.
Another industry linchpin also rattled investors. ASML, whose huge, costly machines are needed to make the most advanced chips, reported much weaker-than-expected orders and warned about tariff-related disruption.
Nvidia stock sank in early trading, as did AMD and ASML. The moves rippled across global markets, with the Nasdaq Composite losing more than 1.5%. Major indexes in Europe and Asia also declined.
Wall Street's fear gauge, the CBOE Volatility Index, jumped after falling for three trading days. The dollar, meanwhile, extended its stretch of weakness.
Wrangling over tariffs continued, with state leaders in California moving to sue the Trump administration. And President Trump said he would join trade talks with a Japanese delegation.
Beijing named a new top trade negotiator, a former ambassador to the World Trade Organization. New data showed China was able to sustain its growth rate in the past quarter, helped by a surge of exports by U.S. importers in anticipation of new tariffs.
Commerce Department data suggested U.S. consumers had also front-loaded purchases. Retail sales surged 1.4% last month, as car buyers rushed to dealerships to get ahead of auto tariffs. The rise was even bigger than expected.
Later Wednesday, Federal Reserve Chair Jerome Powell is due to talk about the economic outlook.
Write to Caitlin McCabe at caitlin.mccabe@wsj.com
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(END) Dow Jones Newswires
April 16, 2025 09:42 ET (13:42 GMT)
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