Semiconductor index drops $500 billion due to fears of stricter trade curbs with China

From Nasdaq: 2024-07-17 19:28:20

Wall Street’s semiconductor index lost over $500 billion in value, marking its worst session since 2020. Rumors of tighter curbs on semiconductor technology exports to China sparked the selloff, with remarks from Donald Trump suggesting Taiwan should pay for defense further impacting chip stocks like ASML and Nvidia.

The U.S. is considering severe trade curbs on companies providing China with advanced semiconductor technology. This news led to significant drops in stocks like ASML and Nvidia, with losses exceeding $200 billion in market capitalization. American chip manufacturing companies like GlobalFoundries and Intel saw gains amidst the turmoil, potentially benefiting from the geopolitical tensions.

Semiconductor market analysts anticipate continued impact from U.S.-China tensions, including potential restrictions on chip technology exports. Focus on supporting domestic semiconductor manufacturing remains crucial. Companies like Intel, with upcoming manufacturing plants in the U.S., may benefit from the situation. President Biden’s administration has been proactive in restricting Chinese access to cutting-edge chip technology, with recent restrictions targeting AI processors.



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