Shares in Nvidia (NVDA) dropped 5% in pre-market trading on Wednesday morning, after revealing the impact of US government curbs on its chip exports to China.
Nvidia said on Tuesday that the US government has required licences for exports to China of the company’s H20 artificial intelligence chip. The chip-maker said the move would result in a financial hit of $5.5bn (£4.1bn).
Asian stock markets fell following the news, with Hong Kong’s Hang Seng (^HSI) index falling 1.9% on Wednesday. The UK’s FTSE 100 (^FTSE) was also in the red on Wednesday morning, down 0.5% at the time of writing.
Russ Mould, investment director at AJ Bell (AJB.L), said: “A warning from AI chips champion Nvidia that it will face a $5.5bn (£4.14bn) hit from tightened US controls on exports to China marks a new chapter in the escalating tit-for-tat between Washington and Beijing, along with Chinese restrictions on ordering Boeing jets.
“The deteriorating relationship between the two countries means China’s better-than-expected [gross domestic product] figures for the first quarter may not attract too much attention given they cover a period before the Trump administration unleashed its trade policy.”
NasdaqGS – Delayed Quote•USD
At close: 15 April at 16:00:00 GMT-4
Shares of chip equipment manufacturer ASML (ASML.AS, ASML) slumped 5% on Wednesday morning, after the Dutch company’s machine orders fell short of expectations.
ASML manufactures lithography machines that are key to making chips, so its net bookings figure is closely watched, in terms of helping gauge sector demand.
Net bookings for the first quarter came in at €3.9bn (£3.3bn), which was down from €7.09bn in the fourth quarter, and was below analyst estimates of €4.8bn.
ASML CEO Christophe Fouquet also warned that the recent tariff announcements had “increased uncertainty in the macro environment and the situation will remain dynamic for a while.”
In the first quarter, ASML posted sales of €7.7bn, which was down from €9.2bn in the fourth quarter. For the second quarter, Fouquet said ASML expected total net sales of between €7.2bn and €7.7bn and reiterated guidance of €30bn to €35bn net sales for the year.
Ben Barringer, global technology analyst at Quilter Cheviot, said that while ASML had maintained guidance for 2025, “that in itself is also a slight concern as it is a very wide forecast and could result in a number of different growth rates. AI demand remains strong, but the uncertainty around tariffs is driving much of the conservative nature of management.
“The share price has derated of late and given this uncertainty this is understandable, but with the guidance in place it is difficult to assess if ASML looks cheap or expensive right now.”
Big releases in the first quarter included crime drama Adolescence, which Netflix said amassed 66.3 million views in its first two weeks. ·Courtesy of Netflix
Shares in Netflix (NFLX) rose nearly 5% in Tuesday’s session, after the Wall Street Journal reported on Monday that the streaming giant is aiming to achieve a $1tn market capitalisation and double revenue by 2030.
The stock hit a record high in February and has since eased back slightly but is up 9.5% year-to-date, with a market capitalisation of $417.6bn.
Netflix (NFLX) is due to report its first quarter results on Thursday, having guided to revenue of $10.4bn and net profits of $2.4bn, with diluted earnings per share of $5.58.
Big releases in the first quarter included crime drama Adolescence, which Netflix said amassed 66.3 million views in its first two weeks.
Investors cheered the streaming giant’s fourth quarter results in January, in which it reported another 18.9 million paid memberships has been added — the biggest quarterly net adds in its history. Revenue for the quarter hit $10.2bn, while diluted earnings per share came in at $4.27.
NasdaqGS – Delayed Quote•USD
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Shares in Boeing (BA) fell 2.4% in Tuesday’s session and were nearly 1% in the red in pre-market trading on Wednesday morning.
This came after Bloomberg reported on Tuesday that China had ordered its airlines to stop taking new deliveries of Boeing jets, which was considered to another move in escalating US-China trade tensions.
Jim Reid, market strategist at Deutsche Bank (DBK.DE), said that “while there had been optimism after the weekend news on tariff exemptions for electronics, there’s been no sign since of either the US or China backing down.”
Last week, Trump announced a 90-day pause on many higher custom tariffs, except for those on China, which now stand at 145% — a 125% reciprocal tariff and the 20% Trump previously levied.
Over the weekend, the White House refined its tariff rules, issuing a rule that spared electronics, including smartphones, from reciprocal tariffs. However, Trump then downplayed that this marked a reversal on tariff plans, saying that there was no levy “exception”.
In an exclusive interview with Yahoo Finance on Tuesday, US Treasury secretary Scott Bessent suggested a deal with China hasn’t yet taken form, but tariffs above 145% may not be in the cards.
“I think no one thinks that these are sustainable over the long run. But with President Trump, I’m not going to give away his negotiating strategy,” he said.
Spokespeople for Boeing and China’s embassy in the UK had not responded to Yahoo Finance UK’s request for comment at the time of writing.
NYSE – Delayed Quote•USD
At close: 15 April at 16:00:02 GMT-4
Support services firm Bunzl (BNZL.L) was the biggest faller on the UK’s FTSE 100 (^FTSE) on Wednesday morning, with shares plummeting more than 22%.
This came after Bunzl cut its guidance for the year, saying it now expected moderate revenue growth in 2025, and anticipated group operating margin to be moderately below 8%, compared with 8.3% in 2024. Bunzl also paused its share buyback programme for the remainder of 2025.
In its first quarter update on Wednesday, Bunzl said that in a “more uncertain macro environment, we have seen some revenue softness across our North American businesses.”
Aj Bell’s (AJB.L) Mould said: “Bunzl is supposed to be a reliable stock — providing everyday essentials like disposable coffee cups to cafes and food wrap to supermarkets. It’s not supposed to pull the rug from under investors’ feet by delivering a major profit warning and abandoning a current share buyback.
“This helps explain the ferocity of the market reaction as the company’s reputation as a steady performer takes a real battering.”
“It could take some time for Bunzl to reestablish its credentials as a steady performer and it faces a real challenge to get back on track given the volatile backdrop,” he added.
