Key Points

• U.S.–China Truce: Tariffs and some export curbs were eased, improving near-term supply chains, but both sides kept leverage tools; expect periodic flare-ups rather than a lasting reset.
• Foxconn Beat: Profit rose 17% on strong AI server demand; management sees continued growth as it leans further into data-center hardware partnerships (including Nvidia).
• SoftBank Pivot: Shares fell up to 10% after selling its Nvidia stake to help fund a larger bet on OpenAI; exposure to AI hardware remains via Arm.
• AMD Outlook: CEO Lisa Su guided to ~35% annual sales growth, targeting double-digit AI data-center market share over 3–5 years, with new rack-scale systems and major partnerships.

U.S.–China Trade Truce Eases Tensions, But Strategic Rivalry Endures

Washington and Beijing rolled back parts of last month’s deal, halving some U.S. tariffs tied to fentanyl precursors and easing Chinese curbs on critical minerals; supporting a short-term thaw in supply chains and commodities.

Yet analysts call the détente fragile: Beijing kept its new export-control framework to retain leverage and is weighing a “validated end-user” screen that could restrict rare-earth flows to firms with U.S. defense ties.

With China’s growth slowing (Q3 4.8%) and both sides pursuing self-reliance, the base case is rolling negotiations and periodic flare-ups rather than a grand bargain, positive for sentiment at the margin but not de-risking the rivalry.

Foxconn Profit Beats on AI Server Demand; Outlook Stays Firm

Foxconn (Hon Hai) posted a 17% YoY profit rise to NT$57.67bn (vs. NT$50.41bn est.) on robust AI server shipments, with revenue broadly in line at NT$2.06tn.

Management expects sequential growth to continue into the back half, led by AI and ICT products, as its Cloud & Networking segment accelerates.

The company is deepening ties with Nvidia and expanding partnerships with Stellantis, Uber, and Mitsubishi Electric (energy-efficient AI data centers), underscoring a strategic shift from consumer devices toward higher-growth infrastructure.

SoftBank Drops Nvidia Stake to Fund AI Bet; Shares Slide

SoftBank shares fell as much as 10% after disclosing the October sale of its entire Nvidia position (32.1 million shares for $5.83 billion) to help fund a $22.5 billion investment in OpenAI, alongside a $9.17 billion trim of T-Mobile.

Management framed the move as reallocating capital while preserving balance-sheet strength; analysts said the pivot doubles down on generative AI rather than signaling bearishness on chips, with exposure to Nvidia’s ecosystem maintained via Arm.

Regional tech names softened in sympathy, including Advantest and Tokyo Electron, while TSMC and SK Hynix edged lower.

AMD Targets Faster Growth on Expanding AI Footprint

AMD CEO Lisa Su forecast ~35% annual revenue growth over the next 3–5 years, anchored by “insatiable” demand for data center AI chips and an AI segment she expects to grow ~80% annually to tens of billions in sales by 2027.

Management aims for double-digit share of the AI accelerator market; still dominated by Nvidia, and highlighted partnerships with OpenAI, Oracle and Meta, plus next-gen MI400X rack-scale systems shipping next year.

Shares dipped ~3% after hours even as long-term gross margin guidance (55%-58%) topped expectations; AMD said core businesses beyond AI remain solid, with Epyc CPUs still a key revenue driver.

Conclusion

Risk sentiment improved on signs of policy de-escalation, with the U.S.–China truce easing some supply frictions even as both sides preserve leverage, implying episodic flare-ups rather than a reset.

Inside AI, capital and demand remain robust: Foxconn’s beat underscores durable infrastructure orders, AMD mapped an aggressive growth path and share gains, and SoftBank rotated exposure from Nvidia to OpenAI while retaining hardware links via Arm.

The setup favors selective participation, own cash-generative enablers of AI compute and efficient manufacturers.

Investment Insights

• U.S.–China truce: Treat the thaw as tactical, not permanent, diversify supply chains and assume periodic flare-ups around critical materials.
• Foxconn’s beat: The “picks and shovels” of AI still look resilient; favor manufacturers with strong customer mix and clear order visibility.
• SoftBank shift: Capital is rotating within AI; the ecosystem extends beyond one chip leader, expect higher volatility as big bets move between platforms.
• AMD roadmap: A credible second source in data-center AI is forming; benefit from a multi-vendor setup, but anchor exposure in firms with proven execution and durable margins.

Economic Calendar

Sources: Federal Reserve events calendar; Investing.com CPI schedule; U.S. Census retail sales release schedule; BLS PPI schedule/FRED; Eurostat and UK ONS release calendars.