US-China AI Race Intensifies, Trump Tariffs Loom, Middle East Conflict Escalates

The AI race between the U.S. and China continues to intensify amid signs that the Trump administration could sanction China over AI model "theft," while OpenAI ramps up efforts for a potentially massive initial public offering.

Another round of President Donald Trump's tariffs also appears to be on the way, as the White House is working to re-create the protectionist trade agenda that suffered a major blow earlier this year.

Meanwhile, the Middle East conflict continues to heat up, with U.S. Central Command announcing strikes in Iran for the 11th consecutive night, amid reports that regional mediators have presented a 10-day ceasefire proposal.

The AI competition between the U.S. and China just got raised another notch, with U.S. Treasury Secretary Scott Bessent saying that the Trump administration will look into whether Chinese AI models have been distilled from American models.

Chinese open-weight models are gaining steam against leading offerings from American companies like OpenAI and Anthropic, prompting worries as to whether the U.S. could still stay in the lead in the AI race. "If we see, especially that overseas models are stealing from our great companies, we have the ability to sanction them because of this theft," Bessent told Fox Business' "Mornings with Maria" on Tuesday.

Meanwhile, OpenAI is ramping up efforts for a potentially massive initial public offering, after it said it appointed longtime financial executives David Vélez and Robin Vince to its nonprofit and for-profit boards of directors.

Lobbying by tech giants is also closely watched by investors. Federal disclosures show the two leading AI developers, OpenAI and Anthropic, have spent $3.17 million together during the second quarter, up 23% from the first three months of the year. Monitoring lobbying spending is a way to gauge which companies and industries are most active in working to influence the federal government.

Tariffs are also back in the spotlight, after U.S. Trade Representative Jamieson Greer on Tuesday hinted that another round of President Donald Trump's tariffs is on the way. "We expect to see some action soon," Greer told CNBC's "Squawk Box" when asked if new tariffs are forthcoming. The White House is working to re-create the protectionist trade agenda that suffered a major blow earlier this year.

Meanwhile, the Middle East conflict continues to heat up, with the United States Central Command announcing that they have done strikes in Iran for the 11th consecutive night. That said, reports that regional mediators have presented both countries with a proposal for a 10-day ceasefire could put last month's memorandum of understanding back on track.

Boeing and Airbus are starting to map out the next generation of narrow-body aircraft, but the world's two dominant plane makers say their airline customers are more concerned with getting today's jets delivered than pressing for all-new models.

Boeing CEO Kelly Ortberg said Monday that the company still needs "a couple more years" to put its finances in a position to support a new commercial aircraft program.

Airbus CEO Guillaume Faury, meanwhile, said the European manufacturer is targeting the launch of a next-generation single-aisle program around 2030, with entry into service in the second half of the following decade.