Nasdaq 100 Analysis: Nvidia, AMD Drop on China Curbs, Dragging US Stocks Down

Tech Selloff Pressures Nasdaq 100 as Nvidia Tumbles on China Export Curbs

The Nasdaq 100 slid more than 1% Wednesday, weighed down by a sharp drop in Nvidia after the chipmaker revealed a $5.5 billion charge tied to new U.S. export restrictions. Broader tech names followed lower, with rising geopolitical friction between the U.S. and China spooking investors.

Why Did Nvidia Sink So Sharply?

Nvidia led the decline, falling over 6% after disclosing a major first-quarter charge related to its H20 AI chips bound for China. The U.S. government now requires export licenses for these chips, which are unlikely to be approved, severely impacting Nvidia’s access to a key market that once accounted for 13% of its sales. Analysts at Jefferies estimate up to $10 billion in lost revenue, with $5 billion potentially slipping from the upcoming July quarter alone.

AMD followed suit, down nearly 6%, as it flagged up to $800 million in similar charges tied to export controls on its MI308 chips. The company will seek licenses but offered no assurances on approvals.

How Did This Affect the Broader Chip Sector?

The semiconductor space took a hit. The VanEck Semiconductor ETF dropped 4%, while the iShares Semiconductor ETF was off nearly 3%. ASML added to the pain after a disappointing earnings report sent its U.S.-listed shares tumbling nearly 5%. Other key names such as Lam Research and KLA Corp declined more than 3% and 4%, respectively.

Which Other Tech Stocks Pulled Back?

Heavyweights across big tech also moved lower. Meta lost nearly 2%, Microsoft shed 1.6%, and Apple fell by almost 2%. Tesla slipped over 1%. The Magnificent Seven Index was down over 2%, reflecting broad-based weakness in high-growth tech names.

Despite some gainers—such as MicroStrategy (+2.2%) and Baker Hughes (+1.2%)—the trend across the Nasdaq 100 was decisively bearish.

What’s the Market Outlook From Here?

Traders are bracing for heightened volatility as geopolitical risks cloud the growth story for tech. Tensions over U.S. export policy and China’s access to cutting-edge AI chips are unlikely to resolve quickly. Nvidia’s charge and the broader chip pullback suggest further downside risk if trade barriers tighten.

Market participants will closely watch commentary from upcoming earnings calls, especially in semiconductors and cloud providers. Any signs of further deceleration in AI infrastructure spending or additional policy headwinds could trigger another wave of selling.

More Information in our Economic Calendar.