US approves Chinese firms to buy Nvidia chips; export restrictions lifted entirely

Reports surfaced on May 15, 2026, that the US government had cleared Chinese companies to purchase Nvidia chips without prior export restrictions, reversing years of Trump-era and Biden-era policies that had severely hampered semiconductor sales to mainland China. Nvidia's China market historically represented roughly 25% of revenue, and the removal of these bans potentially unlocks a multi-hundred-billion-dollar addressable market overnight.

However, the market reaction was mixed and murky. One social media post claimed "$NVDA is going parabolic right now," while others noted NVDA posted a $22 move intraday but with profit-taking evident in the later session. The stock had already rallied strongly on AI infrastructure demand, and the China news may have been partially priced in by traders anticipating a Trump-Xi summit outcome that would deliver trade normalization. Trump's two-day Beijing summit with Xi Jinping concluded with vague commitments on agriculture purchases and rare earth materials, but little concrete on semiconductor carve-outs.

The geopolitical backdrop adds complexity. US Trade Representative Jamieson Greer signaled "a lot of success in rebalancing trade," and China agreed to purchase billions in US agricultural goods. However, Taiwan remained a sticky point, with Xi emphasizing sovereignty and Trump offering no explicit assurances. If the chip export reversal is temporary or contingent on broader trade concessions, NVDA's upside could be capped by de-escalation risk.

Competing narratives emerged: some bulls argue that lifting China restrictions turbocharges AI capex globally, as Chinese data centers can now buy the latest GPUs. Bears counter that Chinese chipmakers (like Huawei's HiSilicon division) have accelerated indigenous designs and may not need cutting-edge Nvidia silicon, reducing addressable market gains. The stock's muted response suggests institutional traders are waiting for concrete evidence of order flow from China before committing to new longs.