US Blocks Nvidia AI Chip Exports to China

MARKET MOVERS

• US blocks Nvidia AI chip exports to China. Nvidia said in a filing yesterday that the US is requiring special licenses to sell two of its processors. Those processors are critical for artificial intelligence work. Nvidia said the crackdown is to prevent the chips from being used by the Chinese military, but they’re also used in corporate data centers. So these restrictions could hurt some of China’s top companies like Alibaba and Tencent. Source(2:37)

• One in five home sellers is now dropping their asking price as the housing market cools. Homes in August sat on the market an average of five days longer than they did a year ago. The median listing price in August was 14% lower than August of 2021 and nearly 42% lower than August of 2019. The average home sold for less than its list price for the first time in over 17 months during the four-week period ended Aug. 28, according to Redfin. Read more here.

• Meta and Qualcomm strike a deal to make custom virtual reality chips for metaverse applications. The two U.S. technology giants have signed a multi-year agreement “to collaborate on a new era of spatial computing,” powered by Qualcomm’s Snapdragon extended reality (XR) platforms. A focus on custom chips by Meta makes sense as it looks to differentiate its headsets and possibly create unique experiences for users.

• Mortgage rates rise again, nearing the affordability threshold. The 30-year fixed-rate mortgage jumped to an average of 5.66%, Freddie Mac reported Thursday. A 5.7% mortgage rate would force the typical household to spend over 25% of its annual income on a median-priced home. Economists say home buyers who can afford to purchase now are better off moving forward rather than waiting for lower mortgage rates. Read more here.

• August employment report: Total nonfarm payroll employment increased by 315,000 in August, and the unemployment rate rose to 3.7 percent, the U.S. Bureau of Labor Statistics reported today. Notable job gains occurred in professional and business services, health care, and retail trade. The Labor Force Participation Rate increased to 62.4% in August, from 62.1% in July.

WHAT TO WATCH

• Twitter plans to allow edits to tweets up to 30 minutes after they’re sent. So far, Twitter’s just testing the feature internally, but the company plans to roll it out to paying Twitter Blue subscribers soon. Edited tweets will be marked with a label to let users know they’ve been changed, and prior versions of the tweet will still be viewable, in an effort to prevent misinformation from spreading on the platform. Source(5:31)

• Bank of America sees no real signs of a bull market. BofA's Savita Subramanian said the market has yet to see the full impact of the Fed’s quantitative tightening. The strategist set her year-end S&P 500 target at 3,600, which would translate into a 9% decline from Wednesday’s close of 3,955. Based on the historical relationship between Quantitative Easing and the market, planned QT implies a 7% market decline. Read more here.

• Oil and gas rise ahead of OPEC meeting and Russian pipeline restart. Russia is due to restart natural gas exports to Europe through the Nord Stream 1 pipeline on Saturday after shutting it down on Wednesday for maintenance. The outage raised fresh concerns that Russia might permanently cut off output in retaliation for sanctions against the country, leading to a winter energy crisis in Europe.

• G-7 rolls out a plan to cap the price of Russian oil. In a statement, the finance ministers of the G-7 said they would move to ban the insurance and financing of shipments of Russian oil and petroleum products unless they are sold under a set price cap. With the plan, the U.S. and its allies are hoping to leverage their control over the financing and insurance of global shipping to force Russia to comply with the cap.

• Microsoft’s Activision deal raises competition concerns, says U.K. watchdog. The regulator said that it is also concerned that Microsoft could use Activision’s games to damage competition in the nascent market for cloud gaming, or the Netflix-like streaming of games via internet-connected devices such as consoles, smartphones, and laptops.