Chip stocks sink to lowest since 2020 as US expands China curbs

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US curbs on China’s access to American technology added to a disappointing start to the earnings season.

-- Shares of semiconductor companies fell Monday, with the industry selling off globally after fresh US curbs on China’s access to American technology added to a disappointing start to the earnings season, stoking concern that the industry’s downturn is far from over.

US-listed shares of chip-equipment maker ASML Holding NV sank 2 per cent and Chinese bellwether Semiconductor Manufacturing International Corp. fell 4 per cent in Hong Kong, the most in five weeks. Declines were steeper in smaller stocks.The US measures include restrictions on the export of some types of chips used in artificial intelligence and supercomputing, and also tighter rules on the sale of semiconductor equipment to any Chinese company.

Chinese Foreign Ministry spokesperson Mao Ning said Saturday that the measures, which are set to enter into force this month, are unfair and will “also hurt the interests of US companies.” They “deal a blow to global industrial and supply chains and world economic recovery,” she said. In Hong Kong, Hua Hong Semiconductor Ltd. fell 9.4 per cent and Shanghai Fudan Microelectronics Group Co. plummeted 20 per cent, the most since July 2020. China’s Will Semiconductor Co. and Maxscend Microelectronics Co. dropped more than 6 per cent each.

To be sure, the intensifying Sino-American tensions could spur Beijing to step up support for homegrown firms in a bid to achieve its goal of becoming an independent chip powerhouse.

 

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