With geopolitical tensions rising, all eyes are on Wall Street. One of the biggest companies in the world, Nvidia (NVDA), has seen its stock seemingly jump despite the brewing US and China trade war. However, does that increase make the AI chipmaker a clear buy or sell?
There is little that investors can be certain about with the talk of tariffs persisting. The United States had previously enacted 25% import taxes on Mexico, Canada, and China. Although the two North American nations were given a month-long reprieve, the same was not true for the BRICS nations. Moreover, the reality will factor heavily into Nvidia’s price trajectory.
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Nvidia Jumps as Geopolitical Tensions Flair: Is It Time to Buy or Sell?
It has been a rather rocky start to 2025 for Nvidia. Although the tech company was expected to challenge Apple (AAPL) for the top market cap spot, that has not looked likely. The company plummeted as much as 17% from the arrival of Chinese startup DeepSeek AI. Now, it is having to contend with growing international uncertainty.
However, the stock performed much better on Tuesday. Specifically, Nvidia (NVDA) saw its stock price jump amid the ongoing faceoff between the US and China. However, does that mean you should buy in on a continued rise or sell ahead of a monumental crash?
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Wall Street appears to be split on the matter. News surfaced that China was enacting an investigation into Nvidia on Monday. The move was poised to bring about some increased leverage for the company in talks with US President Donald Trump. However, Microsoft (MSFT) also announced the implementation of a $80 billion AI development strategy. That is undoubtedly set to benefit the AI powerhouse.
It wasn’t just Microsoft; Alphabet (GOOGL) announced its own $75 billion spending bill. According to Investors Business Daily, much of that is expected to go toward AI development. This has led the company to jump more than 4% early Wednesday.
According to CNN data, the stock is still expected to outperform the market this year. Moreover, of the 67 analysts surveyed, 91% have reiterated a buy rating on the stock. With a 78% upside in its price target and a $175 median target by the experts, it looks like Wall Street is buying. Although there is a 17% downside risk, the reward could be astronomical.