Chinese AI Models Are Worrying Washington and Silicon Valley

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Alex Ossola (0:34)

General Motors says strong demand continues for its pickups and SUVs. Plus, why gold's lost its shine with investors. And the Trump administration is divided on how to respond to powerful new Chinese AI models.

Amrith Ramkumar (0:47)

These models that are being released now could be used to launch cyber attacks or develop new pathogens. Almost anyone can use it. So, that is really setting off alarm bells.

Alex Ossola (0:59)

It's Tuesday, July 21st. I'm Alex Ossola for the Wall Street Journal. This is the PM Edition of What's News, the top headlines and business stories that move the world today.

General Motors Today reported better than expected earnings for its second quarter. The car company also raised its outlook for the year. Gas prices are high, but the company says customers still want its pickup trucks and SUVs. Sales of these larger, pricier models helped lift revenue up about 2% for the quarter, even as the automaker sold fewer total vehicles. Like other automakers, GM has turned away from EVs. After its latest quarter, it's spent almost $11 billion in restructuring charges since the second half of 2025

Looking ahead, GM says it will focus more on investments in defense. Its GM defense unit will have almost $700 million in revenue this year. GM CEO Mary Barra says that unit will be a key driver of its future business.

Mary Barra (2:01)

We are also working with Lockheed Martin and other leading companies to expand speed, scale, and resilience in the defense industrial base.

Alex Ossola (2:09)

GM stock closed up almost 5%.

In Markets, Brent crude futures rose 2% to settle at just over $91 a barrel. It's the first close above $90 in more than a month for the global oil benchmark. Global oil supplies face a growing list of disruptions. There's the Houthis in Yemen threatening to blockade Saudi Arabia. Today, two oil tankers loaded with Saudi crude turned around before making it out of the Red Sea, adding to the difficulties with the Strait of Hormuz crippled. Meanwhile, Ukrainian efforts to stop Russia have disrupted crude oil shipments in the Black Sea and fuel production at Russian refineries. And, in stocks, it was a positive day ahead of some big tech earnings, with Alphabet, Tesla and IBM reporting tomorrow. The NASDAQ led the gains in the indexes and it closed up 1.3%.

Well, markets might be up today, but lately gold has been down. A years-long gold rally is sputtering. Since the start of the Iran War on February 28, gold is down 22%. That may seem surprising since investors tend to seek out gold as a safety net during moments of instability. Now, though, investors are looking past the war to the Federal Reserve. Shradha Dinesh, who covers markets for the Journal, says we might see the price of gold fall further if the Fed does hike rates.

Shradha Dinesh (3:22)

If interest rates do go up in the short term, we might see people pull out of the gold market. The value of gold doesn't provide as much for investors during times where interest rates are high as investors can see greater returns on their treasuries and bonds. And so since gold doesn't pay interest, you're missing out on the opportunity to put your money into a more long-term investment while the returns are higher.

Alex Ossola (3:49)

But gold rose 1.5% today. And even with the recent slide, it's still up about 20% for the year.

Novo Nordisk has filed a lawsuit against rival Eli Lilly, accusing it of deceptive advertising. The complaint says Eli Lilly used outdated studies and ads showed that its drugs were better for weight loss than Novo Nordisk's. The two companies are fighting for control of the nearly $80 billion weight loss drug market. Lilly makes Malangaro and Zep-Bound, while Novo's drugs are Ozempic and Wegovi. Novo Nordisk says that more recent data shows that its drugs are similar to Lilly's when it comes to how much weight patients lose. The drug maker will ask a court to block the ads if Lilly doesn't pull them. Lilly defended the use of the study results, calling them the most direct scientific evidence available.

And American snack food company UTS Brands has agreed to be taken private by German snack maker Intersnack Group for about $2.9 billion. That deal is expected to close by the end of the year. Coming up, how hundreds of non-citizens ended up voting in New Jersey and the era's tour for people who are obsessed with trains. Those stories and more after the break.