U.S. stocks fell sharply Wednesday as Nvidia flagged $5.5 billion in China-related claims and Fed Powell warned that tariffs would slow inflation and growth.
US stocks fell on Wednesday as investors responded to new US restrictions on chip exports to China and new warnings from Federal Reserve Chairman Jerome Powell about the economic risks of President Trump’s tariff policy.
The S&P 500 fell by about 2.2%, while the Dow Jones industrial average fell by 1.7%. NASDAQ composites have been led lower by rapid losses in the high-tech sector, approaching the area of the bare market.
NVIDIA shares plummeted nearly 10% after revealing that a $5.5 billion bill would be required for new export curbs imposed by the US government. This rule affects the H20 graphics processor, a key product in the Chinese market.
Other chipmakers also declined AMD fell by 8%, microns fell by 3%, and ASML stocks fell by more than 7% after weak earnings.
Despite the market sale, Bitcoin (BTC) remained in the $84,000 range and showed resilience.
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Powell’s inflation concerns
In a speech to Chicago’s economic club, Powell said he would wait for the central bank to wait more clearly before adjusting interest rates, warning that tariffs could lead to “higher inflation and slower growth.”
He added that if stable prices and full employment targets fall into conflict, the Fed could face a “challenging scenario.”
Retail data shows sales in March increased by 1.4%, the strongest in two years, suggesting that consumers may be in a hurry to buy items before tariffs take effect.
The Trump administration delayed tariffs in some countries, but China was not included. Treasury Secretary Scott Besset said further clarity on trade policy could emerge within 90 days, but China indicated that consultations must meet certain conditions.
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