Nvidia Slips Amid Chip Tariff Talk. Big Funds Are Piling Into the Stock.

Nvidia chips are the favored hardware for training artificial-intelligence models. (Courtesy NVIDIA)

Nvidia was down in Friday trading. Big funds are buying up the stock, and Donald Trump is talking about 300% tariffs on semiconductor imports.

The chip maker’s shares were down 1.6% at $179.07. They rose 0.2% on Thursday.

Nvidia looks likely to be largely range-bound ahead of its earnings on Aug. 27, after breaking above $180 for the first time earlier this month.

The chip sector in general was suffering on Friday after the president said he would set tariff rates on chips and steel in the next two weeks, and that levies on certain items, including chips, could climb as high as 300%.

Trump said he would likely exempt companies that have promised to manufacture domestically from tariffs. Nvidia is a technology partner for the $500 billion Stargate project, which aims to build new artificial intelligence data centers in the U.S. Its key supplier, Taiwan Semiconductor Manufacturing, is also set to be exempt from chip tariffs, according to the Taiwanese government.

Among other chip makers, Advanced Micro Devices was down 2.5% and Broadcom was down 1.5% in morning trading.

However, some heavyweight funds appear to be optimistic about Nvidia’s prospects.

David Tepper’s Appaloosa firm raised its holdings of Nvidia to 1.75 million shares from 300,000 during the second quarter, according to regulatory filings. Soros Fund Management bought 932,539 shares of Nvidia, when combining puts and calls. The purchase brought the fund’s total holdings to 990,292 shares.

The Securities and Exchange Commission requires the disclosures to be made 45 days after the end of a quarter, so fund holdings could have shifted since the end of the period.

Write to Adam Clark at adam.clark@barrons.com