Did President Trump just crash Nvidia stock?

Nvidia (NASDAQ: NVDA) stock has been trading lower ever since it published its generally strong fourth-quarter (Q4) earnings report. Overall, NVDA shares dropped 9.39% between the February 25 filing and the market’s close on Friday, February 27.

On Monday, March 2, the situation appeared to be changing for Nvidia stock as, through the session, the equity rallied 2.93% to its latest closing price of $182.37. Still, the situation remained dynamic and once again reversed in the extended session with a 3.04% drop to the press time price of $176.83.

Though it is difficult to determine the exact cause for the reversal, reports that the U.S. Government is planning to limit the contentious semiconductor sales to China appear to be the key culprit.

Is President Trump behind the Nvidia stock price drop?

Specifically, President Donald Trump’s administration is allegedly considering a constraint for Nvidia that would see the blue-chip chipmaker be able to sell only up to 75,000 chips per Chinese customer.

The matter of the semiconductor giant selling its hardware in the People’s Republic has been contentious for years. So far, both Washington and Beijing have been rather indecisive about whether Nvidia should be able to sell its product in the East Asian market or not.

This situation has only been made divisive by the fact that, even under the circumstances of the blue-chip chipmaker being permitted to sell, it would only be allowed to ship less advanced models.

Such a setup has, allegedly, made the Chinese side reluctant to accept Nvidia’s hardware and to pursue domestic alternatives whenever able.

Still, it is worth noting that the matter of trade with the People’s Republic has, so far, had only a moderate effect on the semiconductor giant’s equity, meaning that the supposed 75,000 H200 chips per customer limitation is unlikely to have led to the extended session downturn on its own.

Is this $4 billion investment why Nvidia stock price is crashing today?

Indeed, along with the overall volatility and lack of confidence in the current structure of the artificial intelligence (AI) boom, the 3.04% drop for Nvidia stock between March 2 and March 3 could be the result of the company’s latest round of investments.

Reports from Monday indicate that the blue-chip chipmaker decided to invest $2 billion each in Lumentum Holdings (NASDAQ: LITE) and Coherent Corp (NYSE: COHR).

While the stocks of both companies reacted positively to the news, with LITE being up 11.75% and COHR 15.44% during the latest regular session, it is possible investors are reacting with caution to a large-scale cash injection that is unlikely to bear fruit in the near future.

Such a reading is lent additional credence by the fact that both have, following the March 2 rallies, experienced deep corrections in the extended session.

Nvidia stock price is facing systemic pressure in 2026

Elsewhere, it is noteworthy that, much like the case with exports to China, a cool reaction to the investments is unlikely to have been the cause for the drop, especially since it will help ensure Nvidia retains its hardware dominance in the rapidly shifting landscape.

Ultimately, it is possible that the deciding factor behind the extended session correction came due to investors using the selling opportunity presented by the March 2 rally amidst concerns that the semiconductor giant cannot retain its exceptionally high valuation.

Similarly, the selling pressure has likely been exacerbated by low after-hours and pre-market volume, and the actual sentiment regarding Nvidia stock will likely only become known after the March 3 morning bell.

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