Asian markets reacted with a sharp fall to reports of a possible tightening of export restrictions by the United States. Shares of the region’s top semiconductor makers posted significant declines on Thursday, reflecting not only potential sanctions but also Donald Trump’s latest comments regarding Taiwan.
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The world’s largest chipmaker TSMC saw shares fall 4.3% in early trading Thursday, despite the company reporting better-than-expected second-quarter results, CNBC reported. At the same time, Japanese equipment suppliers to TSMC also suffered: shares of Tokyo Electron fell by almost 9%, and Screen Holdings by more than 8%.
Other chip companies such as Tokyo Ohka Kogyo and Organo lost 4.53% and 3.13%, respectively. South Korean chipmakers have also been hit. Samsung Electronics fell almost 2%, SK hynix fell 5% and SK Square fell almost 10%.
The panic in the markets was sparked by a Bloomberg report that the Biden administration is considering limiting exports of critical chipmaking equipment to China, which could further escalate tensions between the two superpowers.
«Chip companies were the darlings of the market. Digitalization is present in almost everything we touch and any tariffs and restrictions on trade will affect these companies. We’re seeing this all over the world,” said Ayako Yoshioka, a senior manager at wealth planning firm Wealth Enhancement Group.
Despite the current state of affairs, Yoshioka believes there are still buying opportunities for long-term investors. “The market reacts strongly to sentiment and news headlines, especially in the short term. In the long term, we need to focus on the promise of artificial intelligence and its potential impact on businesses and consumers,” she said in an interview with CNBC.
The drop in Asian tech stocks followed big declines on Wall Street, with Nvidia down 7% and cutting-edge chipmaker ASML down 12% despite better-than-expected second-year results. quarter.
The situation was aggravated by the statement of the US presidential candidate from the Republican Party Donald Trump, who in an interview with Bloomberg said that Taiwan should pay the US for protection, also accused the island of taking “about 100%” of the US chip business.