S&P 500 and Nasdaq Gain on AI Tech Strength Ahead of Trump-Xi Meeting

The S&P 500 and the Nasdaq gained on May 13 2026, boosted by AI-related tech shares. The advance came even as investors weighed higher inflation data and expectations that the Federal Reserve would maintain restrictive monetary policy. President Donald Trump and President Xi Jinping are scheduled to meet in Beijing the week of May 13 2026.

The summit will occur amid geopolitical tensions surrounding the war in Iran and the status of Taiwan, with technology issues expected to feature prominently on the agenda. S. export controls on advanced AI chips have restricted Nvidia's business in China.

U.S. government receives a 25% cut, yet the trade has stalled due to objections from the Chinese government.

U.S. chip restrictions as an abuse of export controls and has urged its tech firms to cut reliance on Nvidia. DeepSeek has developed AI models to run on domestic chips while Huawei’s AI processors are gaining market share in China.

U.S. government to allow export of more chips to China. Chris Krebs, founder of The Krebs Group and former CISA director, appeared on Squawk Box on May 13 2026.

"We have to keep the frontier chips out of the hands of China," Krebs said. Beijing and Washington are considering setting up a recurring set of dialogues on AI risks including model misbehaviors, autonomous weapons, and AI-powered attacks by non-state actors.

OpenAI and Anthropic have accused Chinese AI labs of using distillation technique to replicate capabilities from American AI models, an accusation also made by Trump administration officials.

Distillation refers to training AI models with the output of more advanced models. The Chinese government has denied allegations of illicit distillation. In April 2026 China announced a regulation allowing government agencies to impose penalties if foreign companies adopt discriminatory measures to stop trading with Chinese businesses.

A separate regulation announced the same month allows authorities to freeze assets or impose exit bans on foreign individuals who help enforce improper extraterritorial jurisdiction against Chinese companies. S. Treasury Secretary Scott Bessent raised concerns about the new Chinese regulations to China’s Vice Premier He Lifeng ahead of the Trump-Xi meeting.

U.S. has banned Chinese electric vehicle imports with high tariffs and regulations. S. as long as they build factories in the country and hire American workers.

U.S. tariffs. In February 2026 the Trump administration rolled out a $12 billion initiative to stockpile critical materials including rare earths.

The initiative aims to support American manufacturers and reduce reliance on Chinese supply chains that dominate processing of materials vital to electronics, airplanes and electric vehicles.