Nvidia Stock Surges Over 5%: What's Going On?

Nvidia Corp. NVDA shares are trading higher Monday following news that the United States and China have agreed to a 90-day rollback of trade tariffs.

What To Know: The agreement is lifting major chipmakers and trade-sensitive stocks across Wall Street, with Nvidia among the top gainers in the sector.

The temporary trade truce, announced after high-level negotiations in Geneva, slashes U.S. tariffs on Chinese goods from 145% to 30% and cuts Chinese tariffs on U.S. goods from 125% to 10%, effective May 14. U.S. Treasury Secretary Scott Bessent and China's Vice Premier He Lifeng brokered the deal, which is expected to reduce inflationary pressures and supply chain bottlenecks that have plagued the semiconductor and electronics sectors since early April.

The agreement marks a pause in what had been an aggressive tariff escalation launched under President Trump's "Liberation Day" policy last month. Markets reacted swiftly, with S&P 500 futures jumping over 3%, the Nasdaq 100 rising more than 4% and semiconductor stocks seeing broader gains.

The tariff cuts are also expected to lower input costs and stabilize global demand for electronics and industrial equipment, both critical to Nvidia's ecosystem. As the news broke, chip stocks including Microchip Technology, ON Semiconductor and Nvidia all saw strong gains, with Nvidia outperforming most of its peers.

While Nvidia's rise is partly driven by the broader sector rally, it also reflects the company’s pivotal role in industries heavily affected by trade policy, including AI, data centers and high-performance computing. Investors are rotating out of defensive assets like gold and into equities, betting that easing trade tensions will lead to stronger earnings and investment activity in the second half of the year.

NVDA Price Action: Nvidia shares were up 4.87% at $122.34 at the time of writing, according to Benzinga Pro.

Read Next: