Jim Cramer believes that Nvidia Corp. NVDA is poised to get a significant boost with the U.S. government assuring licenses for the sale of its H20 chips or general processing units to China, a move that could considerably impact market sentiment.
Check out the current price of NVDA stock here.
What Happened: This development follows a period where U.S. export curbs, initiated in April, had effectively halted H20 chip sales to Beijing, despite the chips being designed to bypass earlier controls.
The news has drawn immediate and enthusiastic reactions from market commentators. Cramer, host of CNBC’s “Mad Money,” took to X and said, “This Nvidia news, so huge, could turn the Nasdaq futures around.”
During the time of writing this article, Nvidia shares were up 4.28% on Robinhood.
Similarly, Nigam Arora, known for his market analysis, posted that “More bullishness in stock futures on $nvda getting permission to sell H20 chips to China for AI.”
Nvidia confirmed the breakthrough in a statement Tuesday, expressing hopes to “start deliveries soon.”
This turnaround comes after extensive lobbying efforts by Nvidia CEO Jensen Huang, including a meeting last week with U.S. President Donald Trump, where Huang reiterated Nvidia’s commitment to American job creation and AI leadership. Cramer also appreciated Huang for his efforts to turn this around.
The potential change in U.S. stance also aligns with a preliminary trade framework agreed upon last month between Washington and Beijing, which included the easing of tech export curbs.
Why It Matters: Ray Wang, research director at Futurum Group, told CNBC that “The lifting of the H20 ban marks a significant and positive development for Nvidia, which will enable the company to reinforce its leadership in China.”
He added that this, combined with upcoming export control-compliant RTX PRO AI chips, should act as a “fresh growth catalyst.”
Meanwhile, NVDA stock ended 0.52% lower at $164.07 apiece on Monday. The stock has advanced 18.62% on a year-to-date basis and 27.74% over a year.
Benzinga Edge Stock Rankings shows that NVDA had a stronger price trend over the short, medium, and long term. Its momentum ranking was solid, whereas its value ranking was poor; the details of all the metrics are available here.
The SPDR S&P 500 ETF Trust SPY and Invesco QQQ Trust ETF QQQ, which track the S&P 500 index and Nasdaq 100 index, respectively, rose on Monday. The SPY was up 0.19% at $624.81, while the QQQ advanced 0.36% to $556.21, according to Benzinga Pro data.
On Tuesday, the futures of the S&P 500, Dow Jones, and Nasdaq 100 indices were trading higher.
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Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
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