NVDA under investigation in China

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Nvidia
shares were under pressure in the premarket Monday after a Chinese regulator said it was investigating the chipmaker over possible violations to the country’s antimonopoly law.

Shares slipped about 2% before the bell.

The State Administration for Market Regulation opened an investigation into the chipmaker in relation to acquisition of Mellanox, the Chinese government said Monday.

“In recent days, due to Nvidia’s suspected violation of China’s anti-monopoly law and the State Administration for Market Regulation’s restrictive conditions around Nvidia’s acquisition of Mellanox shares ... the State Administration for Market Regulation is opening a probe into Nvidia in accordance with law,” according to a statement translated by CNBC.

The news comes as competition heats up between the U.S. and China over chipmaking capabilities. The U.S. has stopped Nvidia and other key semiconductors from selling their most advanced AI chips to the world’s second-largest economy in an effort to limit the country from strengthening its military.

Nvidia did not immediately respond to a request for comment.

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