NEW YORK, December 31, 2025, 03:59 ET — Market closed
- Nvidia moved to boost potential H200 AI chip supply as Chinese demand jumps, sources said.
- AI-linked chip stocks ended mixed in thin year-end trading on Tuesday.
- Traders are watching China import approvals and shifting U.S. export rules.
Nvidia (NVDA.O) has approached contract chipmaker Taiwan Semiconductor Manufacturing Co (2330.TW) to ramp output of its H200 graphics processing units — chips used to train and run artificial-intelligence models — as demand from Chinese tech firms jumps, sources told Reuters. Chinese companies have ordered more than 2 million H200 chips for 2026, far above the roughly 700,000 units Nvidia holds in inventory, the people said. TSMC is expected to begin work on expanded output in the second quarter of 2026, and the plan depends on whether Beijing clears H200 imports after Washington recently allowed exports to China with a 25% fee, the sources said.
The development lands as investors head into the final U.S. session of the year with “AI stocks” still tethered to two hard realities: supply is finite and policy can change fast. China remains a crucial end-market for data-center hardware, and the sector has a track record of reacting sharply to trade-rule headlines.
It also underlines how the AI boom spreads through the supply chain. When a top buyer pulls forward orders, it can ripple from Nvidia to its manufacturing partners and on to the cloud companies and enterprises competing for scarce compute.
Nvidia ended Tuesday down about 0.3% at $187.54, while TSMC’s U.S.-listed shares (TSM.N) fell about 0.4% and AMD (AMD.O) slipped about 0.1%. Broadcom (AVGO.O) rose about 0.2% and Microsoft (MSFT.O) was up about 0.1%, while the VanEck Semiconductor ETF (SMH) edged down about 0.3%.
U.S. stocks closed slightly lower on Tuesday in choppy, holiday-thin trading, as losses in technology were offset by gains in communication services, Reuters reported. Meta Platforms (META.O) rose 1.1% after it said it would acquire Chinese-founded AI startup Manus, keeping AI dealmaking in focus into year-end. Mark Hackett, chief market strategist at Nationwide, called the shift out of technology “a healthy rebalancing.” Reuters
In China, ByteDance plans to spend about 100 billion yuan ($14.29 billion) on Nvidia AI chips in 2026, the South China Morning Post reported — a move that would hinge on whether Nvidia is allowed to sell the H200 in China, Reuters said. Reuters said it could not independently verify the report.
The export-control backdrop is moving in parallel. The U.S. government granted annual licenses for 2026 that would allow Samsung Electronics and SK Hynix to import chipmaking equipment to their factories in China, sources told Reuters, after broader waiver permissions were revoked earlier in the year. Reuters said China is a key production hub for the companies, especially for memory chips in demand for AI data centers.
Nvidia is also in advanced talks to buy Israel-based AI startup AI21 Labs for as much as $3 billion, Calcalist reported, according to Reuters. Nvidia declined to comment and AI21 was not immediately available to comment, Reuters said.
For rivals such as AMD and Broadcom, investors are watching whether tighter Nvidia supply in China changes pricing dynamics or shifts demand toward alternative accelerators and custom silicon. At the same time, rising domestic chip efforts in China keep the longer-term competitive pressure on all U.S. suppliers.
Before the next U.S. session, traders will be looking for any signal from Chinese regulators on H200 import approvals and for any fresh guidance out of Washington on AI-chip trade terms. The bigger question for 2026 is whether policy resets become a recurring feature — and a recurring risk premium — for the AI hardware complex.
U.S. stock markets are scheduled to trade normal hours on New Year’s Eve, before closing on Thursday for New Year’s Day and reopening on Jan. 2, 2026, according to exchange calendars. Bond markets are set to close early at 2 p.m. ET on Dec. 31, and weekly jobless claims are due at 8:30 a.m. ET in an otherwise light data slate.
Nvidia’s next major scheduled catalyst is its fourth-quarter FY26 results on Feb. 25, 2026, and investors will focus on data-center demand and any update on the pace of newer chip rollouts. With the stock near recent highs into year-end, traders will be watching whether it can break out of Tuesday’s range as the next round of policy and demand headlines hits the tape.
