Markets and geopolitics collided today with Nvidia smashing a historic $5 trillion valuation on the back of the AI boom.
Washington and Seoul advanced a $450B trade and security pact amid rising regional tensions.
In the US, the month-long government shutdown is now estimated to wipe out up to $14B in output, and Boeing booked a nearly $5B charge tied to fresh delays on its 777X jet.
A glance at major developments on Tuesday.
Nvidia’s $5 trillion valuation
Nvidia just made history as it’s now the first company ever to hit a $5 trillion market value, powered almost entirely by the AI frenzy.
Jensen Huang says the company has already booked about $500 billion worth of AI chip orders and is planning to build seven supercomputers for the US government, a pretty clear sign of how deeply Nvidia is now embedded in the AI infrastructure race.
The stock jumped more than 4% on the news, and if you zoom out, it’s gone up more than 12-fold since ChatGPT launched in 2022.
That’s a staggering turnaround for a company that once made niche chips for gamers; now it’s basically the backbone of the AI revolution.
Even though rivals are trying to catch up, Nvidia’s partnerships, pace of innovation, and its head start in the AI chip market keep pushing it further ahead, and investors clearly still believe there’s more room to run.
US-South Korea deal
The US and South Korea have moved forward with a major new trade and investment deal at a time when regional tensions are running high.
The agreement, worth about $450 billion, is designed to tighten economic ties and make supply chains between the two countries more secure.
It builds on earlier talks and focuses on key areas like semiconductors, clean energy, and advanced tech.
As part of the deal, South Korea has also agreed to boost its defense spending, which Washington has been pushing for as part of their shared security goals.
Beyond the economic angle, the agreement is also meant to show a united front in the face of North Korean threats and to help keep the Indo-Pacific region stable.
The $14 billion shutdown
The ongoing federal government shutdown in the US, now at 29 days, could cost the economy between $7 billion and $14 billion, potentially reducing fourth-quarter GDP by up to 2%, according to the Congressional Budget Office (CBO).
The shutdown postpones federal spending on wages, goods, services, and nutrition assistance, adversely affecting economic output.
While most losses will be temporary, an estimated $7 billion to $14 billion in output, chiefly from hours not worked, will be permanently lost depending on the shutdown’s duration.
The economy is expected to rebound post-shutdown, but the extended closure worsens lasting economic damage.
Boeing takes $5 billion hit
Boeing just took a big hit to its books as the company recorded a $4.9 billion accounting charge because its 777X jet is still stuck in the certification process, which now delays the plane’s commercial debut to 2027 instead of 2026.
That writedown helped drag Boeing to a $5.4 billion loss for the quarter, with a core loss per share of $7.47, worse than what analysts were expecting.
Even with the setback, Boeing’s revenue actually jumped 30% year-over-year to $23.3 billion, thanks to more aircraft deliveries.
CEO Kelly Ortberg said the company is still focused on finishing key development programs and getting operations back on track, and he insists confidence in the 777X’s flight testing remains strong.
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