After markets resumed trading on Tuesday, the S&P 500 (SPY) and Nasdaq (QQQ) looked like selling would accelerate. Instead, buyers stepped in late in the day. Nvidia (NVDA) gained 6.98% to take a $2.85 trillion market capitalization. It will soon surpass Apple (AAPL), whose market cap is $2.913 trillion.
Nvidia benefited from news that Elon Musk’s xAI startup raised $6 billion in funding. This will give xAI the resources to buy more Nvidia AI hardware. xAI will use Nvidia chips to power its new supercomputer. Musk named its xAI chatbot, Grok.
Tesla (TSLA) is in a holding pattern at $176.75 this month. After the U.S. government imposed a 100% tariff on China's electric vehicles, it removed a pricing war between Tesla and Xpeng (XPEV), Nio (NIO), and Li Auto (LI).
Li Auto and BYD (BYDDF) are the only two profitable EV firms in China.
In the smartphone market, Apple (AAPL) prevented any bearish momentum following its weak quarterly report. It announced an aggressive stock buyback that should limit any downside risks in AAPL stock. On Tuesday, Apple benefited from a 52% increase in iPhone sales in China in April.
Apple launched a rare, aggressive discounting campaign on Tmall. It cut prices by up to 2,300 yuan (around $320) on various iPhone models. A discount this big is unlikely in U.S. markets. The Chinese economy is weak and requires price cuts to drive iPhone sales.
