Nvidia Rises on Tariff Suspension

Markets have snapped back fast.

Nasdaq has nearly erased its year-to-date losses after the U.S. and China agreed to a temporary 90-day pause on tariffs, slashing duties by 115 percentage points. But underneath the surface, this rebound says more about power, chips, and geopolitical maneuvering than it does about trade.

Tech stocks broadly rallied, but Nvidia stood out—surging over 10% in two days. The AI chip giant briefly passed the $3 trillion mark again, driven by two forces: easing trade tensions and the ongoing global AI investment spree. Nvidia doesn’t just benefit from the tariff pause; it’s positioned at the center of a global race for compute power.

The company also gained a boost from U.S. approval to sell advanced AI chips to Saudi Arabia, with 18,000 units headed to a local AI startup backed by the kingdom’s sovereign wealth fund. It’s a clear signal that Washington is selectively loosening export restrictions—not for China, but for allies it hopes to keep close.

A Backdoor to China?

Chips sold to third-party countries like Saudi Arabia can easily end up rerouted to China, sidestepping U.S. export controls. Enforcement is notoriously weak, and the global semiconductor supply chain is nearly impossible to fully track.

While that poses national security risks, for Nvidia and its investors, indirect access to Chinese demand is a profitable gray area.

Apple Wins Too, Quietly

Apple, which warned of a potential $900 million tariff hit earlier this month, also stands to benefit from the truce. But for a company its size, that figure is negligible. The bigger concern remains long-term exposure to China-based supply chains—a slow, expensive problem that won’t be solved by a temporary tariff pause.

Despite the short-term rally, the broader trade war remains unresolved. U.S.-China shipping had stalled in recent weeks, raising fears of product shortages. Businesses still face uncertainty about how long they can rely on China for critical components, and some are already diversifying their supply chains—an expensive and complex process.

The Bottom Line is

This rally is about who gets access to next-gen chips, who controls AI infrastructure, and how much geopolitical risk investors are willing to tolerate in exchange for growth. For now, Nvidia is the poster child of this new era—where regulatory gray zones, not formal deals, shape the future.