Nvidia is being squeezed from two directions at once. Geopolitical forces are shutting it out of China, while on Wall Street a once-unshakeable belief in limitless AI demand is starting to fracture. The stock, which recently changed hands at around 173.74 euros, slipped to 173.32 euros on Wednesday — a 1.08% drop that extended a monthly decline of roughly 10%. At 14.41% below the year’s high of 202.50 euros reached in mid-May, the shares are still up 7.59% on a 12-month basis, but the momentum is clearly fading.
The technical picture mirrors the uncertainty. Nvidia now trades below its 50-day moving average of 181.34 euros, while the 200-day line at 164.03 euros remains a floor. The 14-day relative strength index sits at 44.5, reflecting mild selling pressure rather than outright panic. The stock is drifting, waiting for a catalyst.
That catalyst is unlikely to come from Santa Clara. In China, Nvidia’s once-promising growth market has all but evaporated. CEO Jensen Huang admitted to CNBC that the company has largely ceded the Chinese AI chip market to Huawei, calling the local rival “extremely strong” and predicting an “extraordinary year” for the Chinese ecosystem. Huang’s message to shareholders was blunt: they should “expect nothing” in terms of new export licenses for China. The loss is structural, baked into official forecasts, not a temporary wrinkle.
Meanwhile, Washington is tightening its own grip. Senator Elizabeth Warren summoned Huang to testify before the Senate Banking Committee on Nvidia’s China business and export controls. Huang declined, offering instead to meet committee members at Nvidia’s headquarters. Warren publicly rebuked the refusal, arguing that the American public deserves answers in an open forum. The episode underscores how Nvidia has become a pawn in the US-China tech rivalry, with regulators in both capitals tightening the screws.
On the market side, a different story is unfolding — one that challenges Nvidia’s pricing power. Rich Privorotsky, head of delta one trading at Goldman Sachs, warned that the “scarcity narrative” around AI compute is cracking. Hyperscalers and large AI firms are increasingly reselling their own hardware, putting pressure on GPU rental prices. Meanwhile, the cost of building new data centres is climbing: a megawatt of capacity now runs between $15 million and $20 million. The margin squeeze is real.
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A UBS survey adds to the caution: 60% of companies surveyed have already cut their AI spending, pivoting to cheaper open-source models or alternative suppliers. Nvidia’s second-quarter revenue forecast remains robust at around $91 billion, but the shift toward spending discipline signals a transition from the era of unchecked investment.
The broader chip sector is feeling the strain too. The Philadelphia Semiconductor Index, which soared more than 90% in the first half of 2026, is now correcting sharply. Memory makers Samsung, SK Hynix and Micron — key Nvidia partners — all lost ground on Wednesday, hit by a lawsuit alleging DRAM price-fixing. South Korea, undeterred, is ploughing on with a $590 billion chip industry expansion plan.
Against this backdrop, Nvidia’s upcoming Vera Rubin platform looms large. The company has scrapped the high-end “Rubin Ultra” model due to manufacturing issues at TSMC, but the standard Rubin platform remains on schedule for summer delivery to eight major cloud partners. The quarterly earnings report due at the end of August will be the next big test — a moment to see whether demand for AI hardware can keep pace with the growing supply of compute capacity.
Analysts still see long-term upside, with an average price target of 264.93 euros — a more than 50% premium to current levels. The market appears to be pricing the China void as a manageable headwind within a much larger global AI story. But with a market capitalisation hovering around four trillion euros, Nvidia’s fate is no longer solely in the hands of its engineers. The next major move will likely come from lawmakers in Washington and regulators in Beijing.
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