Business

Nvidia Drops After U.S. Prohibits Sales of Some Its Products to China

Published

5 months ago

September 1, 2022

Justin Sullivan

Nvidia (NASDAQ:NVDA) fell 6.6% in after hours trading after the company warned that U.S. restrictions on exports of some its products to China may hurt sales.

Nvidia disclose late Wednesday that the company was informed on Friday that that the U.S. has imposed a new license requirement for any future export to China (including Hong Kong) and Russia of the company’s A100 and forthcoming H100 integrated circuits, according to an 8-K filing.

Nvidia (NVDA) said that its outlook its fiscal third quarter, which included $400 million in potential sales to China, may be subject to the new license requirement if customers don’t want to purchase the company’s alternative product offerings or if the U.S. doesn’t grant licenses in a timely manner or denies licenses to significant customers.

The U.S. government “indicated that the new license requirement will address the risk that the covered products may be used in, or diverted to, a ‘military end use’ or ‘military end user’ in China and Russia,” Nvidia said in the filing.

Nvidia (NVDA) warned that the new license requirement may impact the company’s ability to complete its development of H100 in a “timely manner” or support existing customers of A100 and may require the Nvidia (NVDA) to transition certain operations out of China.

Advanced Micro Devices (NASDAQ:AMD) also warned that it received a similar note from the U.S. government, though it doesn’t see a material impact, according to a Bloomberg report, which cited an AMD statement. AMD fell 3.8% in after hours trading on Wednesday.

“At the time, we do not believe that shipments of MI100 integrated circuits are impacted by the new requirements,” according to the statement.

The Nvidia China disclosure comes after a Reuters report last month that the Biden Administration is going over new sanctions to stop sending certain chip equipment tools to China to make advanced semiconductors. The Commerce Department is trying to figure out how to ban exports of tools that are sent to factories for Semiconductor Manufacturing International Corp. (OTCQX:SMICY) or SMIC, to prevent them from making semiconductors at 14 nanometer node and smaller.

In December, it was reported that the Biden administration was evaluating imposing tougher sanctions on SMIC (OTCQX:SMICY), China’s largest chipmaker, which have limited the ability of chip equipment companies to sell inside the country, including Applied Materials (AMAT ), KLA Corp. (KLAC) and Lam Research (LRCX).

Original Article: seekingalpha.com

Business

Hot Stocks: BIDU Leads Chinese Tech Stocks Higher; PTON, ODFL Rise on Earnings; SNAP Drops

Published

2 days ago

February 2, 2023

seekingalpha.com

Stocks surged in the wake of the Federal Reserve’s latest interest rate announcement, with the Nasdaq ending Wednesday’s session higher by 2%. Investors focused on comments from Fed Chair Jerome Powell suggesting that the central bank was starting to make progress in its fight against inflation.

Chinese tech stocks participated in the rally, bolstered by news that Blackrock (BLK) had taken an increased stake in Baidu (BIDU). Alibaba (BABA), JD.com (JD) and Pinduoduo (PDD) all received a boost as well.

Elsewhere, Peloton Interactive (PTON) expanded its value by over a quarter following the release of quarterly results. Earnings news also gave a boost to Old Dominion Freight Line (ODFL), which reached a new 52-week high.

Snap (NYSE:SNAP) moved in the other direction, dropping in the wake of its quarterly update.

Sector In Focus

Baidu (BIDU) attracted an increased stake from asset manager Blackrock (BLK), sparking gains among China-based tech names. Investors bet that the sector will continue to draw capital now that the Beijing government has moved away from its zero-COVID policy.

A regulatory filing showed that BLK raised its passive stake in the Chinese tech giant to 6.6%, up from a prior mark of 3.5%. On the news, BIDU soared 13%.

This sparked gains throughout the sector. Alibaba (BABA) and JD.com (JD) each rose around 2%. Pinduoduo (PDD) climbed about 5%.

Standout Gainer

Stronger-than-expected revenue and a narrower loss inspired a wave of buying in Peloton Interactive (PTON). Shares of the one-time pandemic darling, which has plunged since its post-COVID highs, jumped almost 27% on the day.

The home exercise equipment maker reported an adjusted EBITDA loss of $122M, compared to $267M in the same period last year. While its product revenue dropped 52% from last year, subscription revenue rose 22% and now makes up a majority of its top-line total.

PTON finished trading at $16.36, rising $3.43 on the day. This extended gains seen over the past month. The stock has more than doubled since the end of 2022.

With Wednesday’s advance, PTON reached its highest close since last May. However, shares remain about 39% lower for the past year.

Standout Decliner

A disappointing forecast sent Snap (SNAP) sharply lower, with shares of the social media network dropping more than 10%.

The company reported flat revenue for Q4, largely matching analysts’ expectations. However, the company said Q1 sales would likely fall 2% to 10%.

“We continue to face significant headwinds as we look to accelerate revenue growth, and we are making progress driving improved return on investment for advertisers and innovating to deepen the engagement of our community,” the firm’s CEO said.

SNAP slumped $1.19 to close at $10.37. This reversed some of the gains the stock posted headed into its earnings report. Shares remain about 17% higher for 2023 so far.

Notable New High

Old Dominion Freight Line (ODFL) surged more than 10% following the release of better-than-expected quarterly results. With the advance, shares of the trucking company reached a 52-week high.

ODFL reported Q4 EPS of $2.92, exceeding expectations by $0.25. The bottom line was bolstered by operational improvements and a sharp decrease in purchased transportation costs.

In the wake of the earnings report, ODFL surged to an intraday 52-week high of $374.13. Shares moderated from there, eventually ending at $367.62. This represented an advance of $34.38 on the day.

Wednesday’s advance added to a recent upswing, with the stock climbing 30% so far in 2023.

To see more of the day’s best- and worst-performing stocks, head over to Seeking Alpha’s On The Move section.

Article: seekingalpha.com

Business

U.S. Beginning to Detain Some Chinese Aluminum Imports, Top Shipper Says

Published

2 days ago

February 2, 2023

seekingalpha.com

Funtay/iStock via Getty Images

The U.S. has started to detain imports of aluminum products suspected of being made through forced labor, particularly from China’s Xinjiang region, shipper A.P. Moller-Maersk (OTCPK:AMKBY) said Tuesday, according to Bloomberg.

U.S. Customs has begun issuing “detention notices” for such products, the shipper said in an advisory, adding the action probably would target aluminum used in automotive parts.

“Companies importing aluminum products, or commodities with aluminum components, should be proactive in ensuring compliance” with the Uyghur Forced Labor Prevention Act, Maersk (OTCPK:AMKBY) said, referring to legislation signed into law by President Biden in late 2021.

The impact on U.S. aluminum markets likely will be small, Bloomberg reported, as the U.S. imports virtually no primary aluminum from China, and less than 24K metric tons/month of value-added products.

Due mostly to a rally in industrial metals on China’s reopening from COVID restrictions, Alcoa (NYSE:AA) shares have surged 22% so far this year.

Original Article: seekingalpha.com

Business

Gas Stove Controversy Heats up Again As Second U.S. Agency Proposes Limits

Published

2 days ago

February 2, 2023

seekingalpha.com

HJBC/iStock via Getty Images

Gas stoves are coming under renewed scrutiny as the U.S. Department of Energy published a proposal Wednesday for new regulations for the appliances, some of which have never been subject to federal efficiency standards.

The proposed rule-making would set new efficiency standards for both electric and gas cooking tops, preventing them from exceeding set levels of energy use per year.

The DoE proposal represents a standard that “today’s more efficient gas stove designs can meet,” according to Andrew deLaski, executive director of the Appliance Standards Awareness Project.

“We are concerned that this is another attempt by the federal government to use regulations to remove viable and efficient natural gas products from the market,” American Gas Association President Karen Harbertsaid.

Groups representing makers of ranges from companies such as Whirlpool (NYSE:WHR) also aid they were alarmed by the proposal.

ETFs: (NYSEARCA:UNG), (UGAZF), (BOIL), (KOLD), (UNL), (FCG)

Florida governor Ron DeSantis, a potential 2024 presidential candidate, has included an exemption from state sales taxes for all gas appliances as part of his budget for the new fiscal year.

The DoE proposal comes just three weeks after an official with the U.S. Consumer Product Safety Commission floated a potential ban on gas stoves, prompting sharp criticism that forced the Biden administration to disavow the idea.

Original Source: seekingalpha.com