The Rundown - China Warns Tech Giants Against Using Nvidia Chips, Musk Threatens to Sue Apple

Episode Date: August 12, 2025

Stock market update for August 12, 2025. This video is for informational purposes only and reflects the views of the host and guest, not Public Holdings or its subsidiaries. Mentions of assets are not recommendations. Investing involves risk, including loss. Past performance does not guarantee future results. For full disclosures, visit ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠Public.com/disclosures⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠.

Public.com presents the rundown. Your daily market update in under 10 minutes. My name is Zadadmani, and today is Tuesday, August 12th. In today's episode, we'll tell you what the latest inflation report said and the impact from tariffs. We'll also tell you about the challenges that Nvidia is facing in China as they get the green light to enter the market. We'll also discuss why Elon must just threaten to sue Apple.

Then stick around to the end of the show to find out why CEOs, aren't saying the word recession anymore. We got a great show for you today. Let's go. Well, the stock market stumbled out of the gate on Monday with both the S&P 500 and NASDAG dropping 0.3% to start the week. Trading volumes were pretty light. I think everyone was holding their breath for today's inflation report before making any big moves. So let's talk about the inflation report. The July CPI report dropped this morning and inflation came in at 2.7% year over year. That was right in line with expectations. Now, the core CPI, which strips out volatile categories like food and energy, jumped to 3.1%. That's the highest rate we've seen since February.

You know, economists tend to pay closer attention to the core CPI number because it shows the underlying inflation trend. But yeah, the instant reaction to the inflation report is that Trump's tariffs aren't having a major impact on prices just yet. Prices are up slightly, but mostly in line with expectations. Now, it might take more time for tariffs to work their way through the economy, but we'll have to see. Speaking of tariffs, we did have some tariff news yesterday. President Trump extended the China tariff truce by another 90 days. Now, as a reminder here, Trump jacked up tariffs on China to 145% back in April. China then retaliated and increased their tariffs on U.S. imports to 125% that essentially resulted in a trade embargo for the two biggest

economies. So the two sides agreed to a truce and lowered rates in May for 90 days. The U.S. dropped its tariffs down to 30% and China went down to 10%. And now that truce has been extended to mid-November to give the two sides more time to work out a longer-term trade deal. I mean, most people expected for that to happen. So that's why there was no major movement in the market. But yeah, we're going to be on tariff watch for at least three more months when it comes to China.

And who knows, it's probably going to get extended again, just like the TikTok pan. Let's run through some headlines. Starting with NVIDIA. NVIDIA's comeback in China. just hit a major speed bump. According to Bloomberg, Chinese regulators are now discouraging local tech companies in China from using Nvidia's H20 AI chips, especially for any government-related projects, citing national security concerns. And according to the information, they're reporting a much harder line saying that Chinese internet regulators

straight-up ordered tech giants in China like Alibaba, Bightdance, and Tencent to suspend their purchases of Nvidia's chips pending a security investigation. This is coming just days after Nvidia and AMD received the green light from the Trump administration to export their AI chips to China in exchange for a 15% cut of the China revenue going to the U.S. government. We talked more about that on yesterday's episode, so go check that out if you want to learn more. I mean, there is huge demand for Nvidia's H20 AI chips thanks to China's AI infrastructure boom. Chinese tech giants like Alibaba, Baidu, Tencent, Deep Seek, and others are spending billions of dollars developing AI models. And they're trying to use the best chips they can get their hands on, which right now is Nvidia's age 20 chips. But with the government putting pressure on Chinese tech companies to reconsider buying from Nvidia,

it's creating an environment where it's not illegal to buy Nvidia chips just yet, but it is politically incorrect. Now, I'm not a China expert, but that sounds like it's pretty much illegal. Now, the Chinese government might be doing this because they want Chinese tech companies to reduce their reliance on Nvidia's chips and prop up local Chinese chip makers in the process. In fact, local chip makers like Huawei and CamberCon have gained market share in China over the last few months because the H20 chip was banned by the U.S. government. So the Chinese government doesn't want to be in a spot

where their tech companies are reliant on Nvidia moving forward. It might not be great in the short term, but it could pay off in the long term, especially if Huawei and other Chinese chipmakers can build up their chips to compete with Nvidia over time. And look, this is a tough spot for Nvidia to be in. I mean, they finally got approval from the Trump administration to start exporting their chips to China, and now they're facing intense pushback from the Chinese

government. So yeah, I got a feeling that Jensen Huang might be spending a lot of time on his jet going back and forth from D.C. to Beijing. Let's shift gears and talk about Elon Musk, because he just threatened to sue Apple. Elon is accusing Apple of clear-cut antitrust violation when it comes to their app store and showing more favoritism to the chat GPT app. Elon is upset that his apps like GROC AI in X, formerly known as Twitter, aren't featured in Apple's must-have apps section on the homepage of their app store, even though both of its apps are ranked high on the charts. GROC AI is currently ranked number five on the free apps, and X is currently ranked number one in the news category.

So Elon thinks that that justifies them to be included in the must-have app section of the app store. But if you check that section, the only AI app that Apple is featuring is chat GPT. And look, it's true that Apple does have a partnership. with OpenAI that integrates chat GPT into the iPhone. So Apple might have a vested interest in their success. And I do think that Apple's app store has shades of being a monopoly. I'm not sure if not being featured in the must have section is the issue here, though. Now, Apple hasn't responded to these accusations.

I'm not sure if they will because they're already dealing with an antitrust suit by the DOJ in regards to their iPhone ecosystem. But they might have more lawyer fees to pay if Elon moves forward with a lawsuit. You know, what's funny, though, is Sam Altman, the CEO of OpenAI, he did fire back on X, and he called out Elon for manipulating the X algorithm for his own benefit. So it's just more tech drama, keeping us all entertained. Let's talk about some stocks making moves today. Circle Stock is having a nice pop this morning after the stable coin company reported its first quarterly earnings as a publicly traded company. Their numbers were

solid. Revenues were up 53% to $658 million in Q2, thanks to strong. growth and adoption of their USDC stable coins. The company said that circulation of the USDC stable coin grew by 90% from the previous year to $61 billion. And that number is expected to rise with the passage of the Genius Act last month, which rolled back some crypto restrictions. Now, Circle did report a $482 million loss in Q2, but most of that was related to non-cash IPO related charges. You know, it's kind of like buying a house. You have to pay closing costs and a bunch of other fees, but those are all one-time charges and shouldn't have an impact on earnings moving forward. Shares of Circle are up more than 7% this morning in reaction to these earnings.

By the way, Circle stock has now gone up more than 400% since its IPO back in June. Now, sticking with the winners here, let's talk about OnCloud. The Swiss sneaker company is seeing its stock jump this morning after crushing their earnings. Sales jumped 32% in Q2, which beat Wall Street estimates, and they're also raising their guidance. Now, some investors were concerned that on-cloud sales would be hurt in the U.S. from tariffs on Vietnam since they source 90% of their products from there. But the tariffs have had no impact so far. In fact, the company raised prices in July to offset the tariff cost and the CEO said they haven't seen any pushback from consumers. Investors love hearing the sound of that.

The stock is up more than 13% this morning at the time of this recording. Now, on the flip side, shares of Archer Aviation are down after the futuristic aerospace company reported a bigger than expected loss burning more than $200 million in Q2. Archer is working on a EVTOL, which stands for electric vertical takeoff vehicle. It's essentially an electric helicopter that looks straight out of a sci-fi movie. The company has been delivering these vehicles in small capacity to customers like the UAE. Archer expects to operate two units, a commercial aircraft taxi business, and a military division. But the latest earnings report has spooked some investors and Archer aviation shares are down nearly 5% this morning on this news.

Let's wrap the show with a fun fact. CEOs have apparently stopped saying the R word. According to facts set insight, mentions of recession on S&P 500 earnings calls have plummeted 87% this quarter compared to Q1. Just 16 companies out of the 500 have brought it up compared to the 124 companies last quarter. Now, we still have a few more earnings to go,

but that's a pretty big turnaround. Now, keep in mind, the Q1 earnings calls were happening at the peak of the tariff shock. just goes to show you how fast the vibes have shifted in a short amount of time. Now, if you look at the five-year average, the word recession is mentioned around 74 times per quarter in earnings calls. So we're way below that right now, and I'm not sure if that's a bullish sign or just peak optimism. Well, all right, guys, that's the rundown for today. Hope you guys enjoyed today's episode. If you did, and you have like eight extra seconds,

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