Nvidia H200 Cleared for China as Trump-Xi Summit Drives Nasdaq Rally

TL;DR

President Trump met Xi Jinping at Beijing's Great Hall of the People on Thursday, agreeing to a "strategic stability" framework and a joint commitment to keep the Strait of Hormuz open. Alongside the summit, the U.S. Commerce Department approved roughly 10 Chinese firms - including Alibaba, Tencent, ByteDance, and JD.com - to purchase Nvidia's H200 AI chips. Nvidia CEO Jensen Huang joined the delegation in Beijing to press for delivery. Nasdaq futures rose 0.5%, S&P 500 futures gained 0.3%, and Nvidia shares surged over 2.6% in premarket trading as of 10:15 a.m. ET.

What Happened at the Trump-Xi Beijing Summit

President Donald Trump touched down in Beijing on Wednesday, May 13, and met Chinese President Xi Jinping at the Great Hall of the People on Thursday morning local time. The two leaders agreed to pursue a "constructive China-U.S. relationship of strategic stability" - a framing Beijing described as the guiding framework for the next three years.

Pre-summit trade talks held in South Korea the day prior, led by U.S. Treasury Secretary Scott Bessent and Chinese Vice Premier He Lifeng, yielded what Xi called "overall balanced and positive outcomes." Xi told reporters China's door to further opening "will only open wider," while the White House called the meeting "highly productive."

One of the summit's most market-relevant outcomes: both governments agreed that the Strait of Hormuz "must remain open," according to a White House readout. That statement carries weight given that Iran's selective control over tanker traffic through Hormuz - through which roughly 20% of global oil trade passes - has kept crude prices elevated above $105 per barrel in recent weeks.

Seventeen U.S. business leaders joined the delegation, including Tesla's Elon Musk, Citigroup CEO Jane Fraser, and Meta president Dina Powell McCormick. Nvidia CEO Jensen Huang was added to the trip after a personal invitation from Trump, who picked him up in Alaska en route to Beijing. Huang's presence signals a focused push to unlock stalled H200 chip deliveries.

Separately, Reuters reported exclusively that the U.S. Commerce Department has cleared roughly 10 Chinese companies to buy Nvidia's H200 chips. The approved buyers include Alibaba, Tencent, ByteDance, and JD.com, with distributors Lenovo and Foxconn also authorized. Each approved customer can purchase up to 75,000 chips under current U.S. licensing terms. No deliveries have been made yet: Beijing has increased scrutiny of foreign technology suppliers, leaving the approvals in regulatory limbo on the Chinese side.

Why Nvidia H200 China Approval and the Trump-Xi Summit Moved Markets

For markets, these two developments land at the same time and reinforce each other. The H200 approval removes a formal U.S. barrier to one of the largest potential chip contracts in the industry. China represented roughly 13% of Nvidia's revenue before export controls tightened, and Huang has estimated the country's AI market alone is worth $50 billion this year. A full delivery pipeline would be material to Nvidia's forward revenue.

The broader summit narrative matters for equities at a macro level. The "strategic stability" framing suggests both governments want to contain further escalation across trade, technology, and the Taiwan file - even if no single binding agreement was reached. For investors running risk portfolios with exposure to U.S. multinational tech, a managed rather than adversarial US-China posture is a meaningful de-risking signal.

The Hormuz joint statement adds a secondary market consideration. Oil above $105 has been a persistent drag on corporate margins and consumer spending. Any credible diplomatic step toward keeping the strait open reduces the tail risk of a sharper supply shock, even if it does not resolve the underlying Iran conflict.

Implications for Traders

• Stock and equity futures traders: Nasdaq outperformance is the dominant short-term trade. Semiconductors (the PHLX Semiconductor Index has risen roughly 64% since late March) and hyperscalers - Alphabet, Amazon, Microsoft - are the focal sectors. Watch whether the Nvidia open confirms the premarket move or fades into the close.
• Futures traders: The 10-year Treasury yield closed Wednesday at 4.46%, near its 2026 high. Equity futures gains are running into a rate backdrop that prices no Fed cuts this year, after CPI came in at 3.8% and PPI at 6%. Risk-on from the summit does not change that picture, so any rally is likely capped unless the summit's follow-through details are strong.
• Oil and commodity traders: Brent and WTI remain above $105. The Hormuz joint statement is not a ceasefire and does not immediately end Iran disruptions - but it introduces a soft diplomatic ceiling that could limit further crude upside. Watch for any Iranian response to US-China coordination on this issue.

Potential Positives vs Negatives

Positives:

• H200 approval formally opens a massive revenue pathway for Nvidia if Beijing's own restrictions ease.
• A "strategic stability" framework reduces the probability of sudden tariff escalation or tech export shocks over the next 12 to 24 months.
• Joint Hormuz statement introduces diplomatic constraint on further oil-supply disruption risk.
• A September Xi visit to the White House would extend the constructive tone and provide another scheduled positive catalyst for risk assets.

Negatives:

• H200 deliveries remain stalled on the Chinese side. Approval is not revenue until chips actually ship.
• Xi's warning that Taiwan "remains the most important issue" and could create a "highly perilous situation" is a persistent risk that no summit fully removes.
• The macroeconomic backdrop - PPI at 6%, CPI at 3.8%, no rate cuts in sight - means any equity rally runs against tightening financial conditions.
• Oil above $105 continues to act as an implicit tax on consumers and margins, independent of any diplomatic statement.

What Could Happen From Here

Base case (50-60% probability): Nasdaq holds gains today and Nvidia closes up 2-4%. The strategic stability framing keeps US-China tensions in a managed corridor through summer. H200 deliveries remain slow to materialize as Beijing navigates its own supply-chain review, but a timeline toward actual shipments begins to take shape. Oil stays elevated near $105 but the Hormuz statement prevents a further spike. Confirmed by: Nvidia issuing constructive guidance language on China and no escalatory Taiwan rhetoric in follow-up readouts. Invalidated if Beijing formally blocks H200 deliveries or Taiwan tensions flare after the summit.

Upside case (20-25% probability): Huang secures a concrete delivery timeline in Beijing this week. Actual H200 shipments begin within 30 to 60 days. Markets price a meaningful uplift to Nvidia's FY2027 revenue outlook, with semis and hyperscalers extending their rally. A US-China joint position on Hormuz contributes to a crude pullback toward $95-100, relieving inflation pressure. Confirmed by: a Nvidia press release on delivery timelines before week's end or strong management commentary at an investor event.

Downside case (15-25% probability): The premarket rally fades as traders assess that H200 approvals are already priced in and deliveries remain uncertain. Macro headwinds - 10-year yield at 4.46%, sticky PPI - cap tech multiples. Any Xi comment on Taiwan interpreted as hardening in aftermath commentary triggers a quick reversal. Oil remains sticky above $105 without a concrete Iran resolution. Confirmed by: Nasdaq closing below its opening gap, Nvidia giving up premarket gains, or a fresh Taiwan-related escalation headline.

What to Watch Next (24 Hours)

• Nvidia management commentary - any formal statement on China delivery timelines from Huang or the company during or after the summit.
• Official joint statement - the White House and State Department bilateral readout expected later Thursday will clarify whether any binding trade or technology commitments were made.
• CLARITY Act markup result - the Senate Banking Committee began its markup at 10:30 a.m. ET; the outcome will add or remove a key crypto catalyst from this week's market agenda.
• Oil reaction - watch Brent and WTI for any response to the Hormuz joint statement and whether Iran signals a reaction to US-China coordination.
• 10-year yield - if yields extend toward 4.48-4.50% (the 2026 high), that could cap the equity rally regardless of summit optimism.
• Xi White House visit confirmation - if a September visit is formally scheduled, expect another risk-on headline.

Frequently Asked Questions

What is the Nvidia H200 chip and why does China want it?
The H200 is Nvidia's second-most powerful AI accelerator, purpose-built for training and running large language models. Chinese tech firms including Alibaba and ByteDance rely on hardware like the H200 to compete in AI development. U.S. export controls since 2022 have blocked most advanced chip exports to China, forcing domestic alternatives that remain behind Nvidia's hardware on key performance benchmarks.

Why did Jensen Huang join the Trump delegation to Beijing?
Huang was added to the trip at Trump's personal invitation to represent the technology industry and press directly for H200 delivery clearance. Nvidia commands roughly 95% of China's advanced chip market when exports are permitted. With approvals granted on the U.S. side but shipments stalled due to Beijing's own review of foreign tech suppliers, Huang's presence in Beijing is aimed at unblocking the hold on the Chinese end.

Sources

Reuters - U.S. clears H200 chip sales to 10 China firms | CNBC - Five takeaways from the Trump-Xi summit | AP News - Trump-Xi summit live updates | Al Jazeera - Trump-Xi summit liveblog

For context on the crypto side of today's market action, see our earlier post on the ChartDojo blog covering the CLARITY Act markup and Bitcoin short squeeze setup.

Reading summit headlines and reacting to price action - for more market context, see the ChartDojo market analysis blog. Reading summit headlines is different from building the analytical discipline that separates consistent traders from the crowd. ChartDojo gives you AI-powered feedback on your actual trade decisions - so you build real skills, not bad habits. Try it free and see how your analysis holds up when markets move like this.

Header image source: pexels by Mikhail Nilov. License: PEXELS.