U.S.-China trade talks now facing even higher stakes after Chinese regulators announced today

that NVIDIA violated one of its antitrust laws with its 2020 acquisition of Melanox.

Our Christina Parts-Nevilose has more on that in today's tech check.

They're going back away on this one, KP.

Yeah, they are, so five years.

Well, China's market regulator, like you said, announced this morning that

NVIDIA violated anti-monopoly law, but this isn't really about antitrust.

It's about leverage.

Beijing launched this probe, to your point, Carl, in December.

Just one week after Washington unveiled tougher chip export controls

and conveniently announced the, quote, violation today as U.S.-China

trade negotiations are meeting in Madrid this week. The alleged breach involves NVIDIA's 2020

Melanox acquisition, which was a deal China approved with conditions five years ago. So why act now?

Pure posturing to gain negotiating power. InVity isn't commenting on this story just yet, but shares, as you can see, are down

over 1.5% and the selling pressure really extends across semiconductors.

The SOX index rose about 4% last week on AI euphoria, but that rally may look vulnerable

right now. China also launched an anti-dumping probe Saturday targeting

U.S. analog chip suppliers like Texas Instruments, and that's why you can see its shares

are down almost 3% right now. But for Nvidia investors, the bigger worry is that revenue upside

hinges partially on China demand. The U.S. recently granted NVIDIA licenses to sell their H20 AI chips into China,

but shipments haven't started because Chinese cloud customers need Beijing's final approval.

That approval is now clearly part of China's negotiating strategy.

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