Trump-Xi Summit Puts Nvidia, Boeing And 500-Jet Deal In Focus – Yahoo Finance
This article first appeared on GuruFocus.
Markets are heading into Donald Trump’s meeting with Xi Jinping with major US stocks near record levels, and the next two days could become a fresh test for investors who have so far appeared calm about the risks. Nvidia (NASDAQ:NVDA) rose 1.9% Wednesday after co-founder Jensen Huang joined Trump’s China trip as a last-minute addition. Micron Technology (NASDAQ:MU) climbed 6.3%, Qualcomm (NASDAQ:QCOM) advanced 4.4%, Tesla (NASDAQ:TSLA) gained 1.5%, and Apple (NASDAQ:AAPL) rose 0.7%. Piper Sandler data show the S&P 500 is projected to move about 0.7% on both Thursday and Friday, less than the expected move in Chinese Internet stocks over the same period and less than the expected move in the index after Nvidia’s earnings next week.
The setup matters because investors may be underpricing how much could still go wrong. The talks are expected to cover tariffs, Iran, aerospace, agricultural products, critical minerals, and technology, giving several major sectors a direct line to any positive or negative headlines. Danny Kirsch of Piper Sandler said anything that is not positive for technology and AI shares tied to US-China trade relations, or renewed Middle East tensions in Iran, would likely be viewed poorly by investors. Boeing (NYSE:BA) could be one of the most closely watched names, as China is considering a deal for about 500 Boeing 737 Max aircraft, while CEO Kelly Ortberg has said Trump’s visit could be a meaningful opportunity. Bloomberg Intelligence analyst George Ferguson said there is a high probability a Boeing order is announced, though any impact on Boeing’s income statement may take time or may not happen.
The summit could also matter for agriculture, rare earths, and semiconductors, where even small shifts may possibly move sentiment. A Chinese commitment to buy US agricultural products could help American farmers and may lift names such as Deere (NYSE:DE) and Corteva (NYSE:CTVA), with corn and soybeans part of the discussions, according to traders briefed on the matter. In critical minerals, an agreement on rare earth flows could create risk for MP Materials (NYSE:MP), which rallied more than 100% after the Pentagon took an equity stake last year, while the US government has also taken stakes in USA Rare Earth (NASDAQ:USAR), Lithium Americas (NYSE:LAC), and Trilogy Metals (TMQ). For chips, China’s access to AI semiconductors may be on the table after Nvidia secured a license to sell some less-advanced processors there. Scott Ladner of Horizon Investments said Nvidia’s outlook assumes zero China sales, meaning a material change could possibly alter demand expectations for the broader chip industry.
