The start of an antitrust investigation in China, which examines the chip giant’s practices, occurs amid geopolitical tensions with the United States over the dominance of artificial intelligence.
The Nvidia stock (NVDA) They fell more than 3% this Monday after China opened an antitrust investigation against the chip giant amid growing tensions between Beijing and Washington over the artificial intelligence race.
The investigation is focused on Nvidia’s practices in possible violations of antitrust laws. It will also examine its acquisition of Mellanox in 2020, a purchase approved by the State Regulatory Administration of the China Market under the condition that the chipmaker avoid discriminating against Chinese companies.
According to a Chinese media report, the government believes that the purchase of $7 billion from Nvidia of the Israeli computer networking equipment company may have violated Beijing’s antitrust rules. The investigation comes about a week after the Biden administration implemented a new round of semiconductor export restrictions to limit China’s access to advanced chips.
What the market analyzes
The latest US measures include restrictions on high-bandwidth memory chips sent to China, crucial components for artificial intelligence training.
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The Chinese investigation against the most important US chipmaker also coincides with Donald Trump’s upcoming return to the White House next month. Trump threatened to raise tariffs as part of his policy.
Nvidia shares did not participate in the broader market rally following Trump’s election and victory last month. The stock has risen just over 1% since Trump’s victory.
However, Nvidia stock is up nearly 190% so far this year.
Source: Ambito
