Nvidia surge drives S&P 500 and Nasdaq to record highs on China chip approval

Wall Street's major indexes touched all-time intraday highs Thursday after U.S. authorities cleared roughly 10 Chinese companies to purchase Nvidia's H200 artificial intelligence chip, sending the chipmaker's shares up 3.9%, The Korea Times reported.

The records highlight how tightly U.S. equity markets are now tethered to artificial intelligence policy in Washington — a dynamic with direct relevance for OC's Korean-American tech workforce and the many households in the region with tech-heavy retirement and brokerage accounts.

Nvidia reached a market capitalization of approximately $5.7 trillion after Reuters reported that U.S. authorities had approved around 10 Chinese firms to acquire its H200 chip. The technology sector climbed 2.1% for the session, the strongest gain among the S&P 500's 11 major groups, seven of which posted advances.

Cisco Systems added to the market's momentum with a 14.4% surge to an all-time high after the networking giant announced a restructuring plan that will cut nearly 4,000 jobs while raising its revenue outlook.

At 12:08 p.m. Eastern time, the Dow Jones Industrial Average was up 0.99%, the S&P 500 had gained 0.96% and the Nasdaq Composite was up 1.12%, according to The Korea Times. Advancing issues outnumbered decliners by a ratio of 2.43 to one on the New York Stock Exchange. U.S. retail sales rose 0.5% in April, matching economist forecasts.

Chris Zaccarelli, chief investment officer at Northlight Asset Management, said Nvidia "has clearly been a big beneficiary, both from the China announcement and from the broader artificial intelligence theme." He added a note of caution: "The underlying AI theme and trend is real — we just think investors may be pulling a little too much forward from the future."

Broader geopolitical currents also shaped the session. U.S. and Chinese officials reached an agreement that the Strait of Hormuz should remain open and that Iran should never obtain nuclear weapons. Chinese President Xi Jinping separately warned that tensions over Taiwan could risk conflict.

Despite Thursday's record headlines, the S&P 500 software index remained 16.3% below its year-to-date starting level even after gaining 1.4% on the day — a sign that the technology sector's recovery beneath the surface remains uneven.

Unemployment claims rose modestly last week, injecting a mild note of economic caution even as investors celebrated AI-driven records. Market watchers are now monitoring whether Washington's evolving stance on chip exports can sustain the rally through the rest of earnings season.