Nvidia shares fell 7.81% on Thursday during the sharpest market meltdown since 2020, after President Trump earlier this week touched off a global trade war, sparking concerns for U.S. companies with ties to China and Taiwan.
The tariffs, which Trump announced on April 2, will be 34% on Chinese imports and 32% on Taiwan-made goods, where Nvidia primarily manufactures its chips. Semiconductors were
initially exempted from the tariff plan, yet, it remains uncertain how the company would be affected.
Even CEO Jensen Huang’s reassurance during the company’s March 19 conference – that tariffs would have little short-term impact – failed to calm investors. Nor did Wednesday’s reports that Google is in advanced talks to rent Nvidia’s new Blackwell chips assuage investors’ concerns. Shares still sank on Thursday, in line with a broader selloff across major tech stocks.
HSBC’s Frank Lee downgraded his rating on Nvidia from buy to hold on Thursday. The analyst lowered the target price to $120 from $175 highlighting constrained short-term growth prospects. The new tariffs are only partially to blame, as he believes the company navigates a transitional period before capitalizing on emerging AI opportunities in robotics and autonomous vehicles.
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