S&P 500 cuts losses as Nvidia climbs ahead of results
Investing.com-- Most Asian stocks moved in a tight range on Tuesday as markets digested data showing strong economic growth in China, while concerns over higher U.S. trade tariffs remained in play.
Technology stocks, especially in China, were buoyed by major chipmaker NVIDIA Corporation (NASDAQ:NVDA) stating that Washington will allow it to resume sales of a popular artificial intelligence chip in China, reflecting further deescalation in a trade conflict between Washington and Beijing.
But U.S. President Donald Trump’s recent announcement of tariffs against several other major economies remained a major point of contention for markets, especially given that the targeted economies have just over two weeks left to hash out trade deals with Washington.
Japan’s Nikkei 225 and TOPIX indexes fell slightly, maintaining a downward trend after Trump slapped the country with 25% tariffs. South Korea’s KOSPI fell 0.1%, with the country also facing a 25% U.S. levy.
Regional markets took middling cues from a sluggish overnight session on Wall Street. But S&P 500 Futures erased early losses and rose 0.1% after Nvidia’s announcement, with focus now squarely on key consumer price index inflation data due later on Tuesday.
China stocks sluggish as Vanke profit warning offsets strong Q2 GDP
China’s Shanghai Shenzhen CSI 300 rose 0.1%, while the Shanghai Composite fell 0.4% amid losses in state-backed property giant China Vanke Co Ltd (SZ:000002). Shenzhen shares of the firm fell over 2% after it forecast a $1.67 billion loss in the first six months of 2025, ramping up concerns over a prolonged decline in China’s key property market.
But losses in Chinese markets were limited as gross domestic product data showed the Chinese economy grew more than expected in the second quarter.
GDP grew 5.2% year-on-year, more than expectations of 5.1%. China’s GDP in the first six months of 2025 also came to 5.3%, remaining above Beijing’s 5% annual target.
The print was driven by improving trade relations between the U.S. and China, which saw the latter subject to only about a month of steep U.S. trade tariffs. Consumer spending subsidies from Beijing also helped bolster local growth.
SMBC analysts noted that the muted market reaction to China’s GDP figures was likely due to growth above 5% already being priced in.
Chinese markets had also marked strong gains in recent weeks after Washington earlier in July relaxed restrictions on the export of chip design tech to China, while Beijing signaled it will resume rare earth exports.
Hong Kong rises as tech cheers Nvidia H20 announcement
Hong Kong’s Hang Seng index was an outperformer in Asia on Tuesday, rising 0.8%.
This was fueled chiefly by gains in local tech majors, including Alibaba (NYSE:BABA) Group (HK:9988), Tencent Holdings Ltd (HK:0700), and Baidu (NASDAQ:BIDU) Inc (HK:9888).
Access to Nvidia’s H20 chip, which is wildly popular in China, will allow Chinese tech majors to proceed with their artificial intelligence ambitions.
Chinese chipmakers, however, were less upbeat, given that the move now presents more overseas competition. Semiconductor Manufacturing International Corp (HK:0981) fell 1.1% in Hong Kong trade.
Taiwan stocks rose on Nvidia’s announcement, with major chipmaker TSMC (TW:2330) rising 1.4% on the prospect of increased demand in China.
Broader Asian markets were mildly positive. Australia’s ASX 200 rose 0.4% and was close to a record high.
Singapore’s Straits Times index rose 0.2%, while Gift Nifty 50 Futures for India’s Nifty 50 index were flat. Indian CPI inflation data read softer than expected for June, likely setting the stage for more monetary easing by the Reserve Bank.