Monday, November 28, 2022

Asian chipmaker’s shares slide after the US put restrictions on China

Related posts

[ad_1]

Asian chipmaker’s shares slide after the US put restrictions on China

Asian chipmaker’s shares slide

  • After the US unveiled strong new regulations to restrict sales of technology to China, shares in key Asian computer chipmakers fell.
  • According to the US, American companies will not be allowed to sell certain chips used in supercomputers and artificial intelligence to Chinese companies.
  • As the world economy weakens, technology companies are also witnessing a decline in demand.

After the US unveiled strong new regulations to restrict sales of technology to China, shares in key Asian computer chipmakers fell.

According to the US, American companies will not be allowed to sell certain chips used in supercomputers and artificial intelligence to Chinese companies.

The regulations, which were made public on Friday, also target purchases made by foreign businesses using American-made machinery.

As the world economy weakens, technology companies are also witnessing a decline in demand.

On Tuesday, the stock of Taiwanese chipmaker TSMC sank more than 8%, Tokyo Electron in Japan dropped 5.5%, and Samsung Electronics in South Korea dropped 1.4%.

The declines followed the reopening of the stock markets on Tuesday in Taiwan, Japan, and South Korea following their closure on Monday for public holidays.

In other parts of Asia, shares of SMIC, the largest chipmaker in China, declined by 4% in Hong Kong.

To provide Chinese chipmakers with machinery that can build more sophisticated chips, US companies are required to seek a license under the restrictions.

According to Washington, the regulations seek to stop Chinese military and technology advancements.

The steps signal one of the most significant changes in US policy regarding technology exports to China in decades, some of which take effect right away.

The Nasdaq index, which is heavily weighted toward technology, dipped on Monday in the US, dropping to its lowest level since July 2020 as shares of chipmakers Intel, Nvidia, Qualcomm, and Advanced Micro Devices declined.

Lower demand for electronic devices, including computers and cell phones, has recently hurt technology shares around the world.

Samsung, a major South Korean technology company, issued a 32% profit decline warning on Friday.

The largest smartphone manufacturer in the world reported lower profitability from its microprocessor manufacturing division as memory chip prices fell globally as a result of declining consumer electronics demand.

Sonal Varma and Si Ying Toh, analysts at Nomura Research, stated that “the chip drop signals a deeper export decline lies ahead.”

They wrote in a report on Tuesday that “export growth has already gone negative in September in India, but the evidence is building that export growth across other Asian economies will turn negative in Q4”.

Also Read

Landslides in Venezuela kill several people and destroy homes
Landslides in Venezuela kill several people and destroy homes

36 people have now been confirmed dead, while 56 more remain missing…

[ad_2]

Related Posts

Advertisment

Advertisment