Chip stocks volatile with China-US spat in focus
Asia chip stocks extend heavy selloff, U.S. trading choppy
TSMC closes down, posts better-than-expected earnings
ASML adds to losses from previous session
Updates prices, adds comments after U.S. stock market close
By Sinéad Carew and Youn Ah Moon
NEW YORK/SINGAPORE, July 18 (Reuters) -Trading in U.S. chip stocks was choppy on Thursday with the Philadelphia semiconductor index .SOX managing to close higher after tumbling on Wednesday with its biggest contributions from a handful of heavyweights Nvidia NVDA.O and Broadcom AVG.O.
Chip stocks in Asia had sold-off earlier in Thursday after a report that the United States was considering tighter curbs on exports of advanced chip technology to China.
Bloomberg News had reported that U.S. President Joe Biden's administration was weighing a measure called the foreign direct product rule that would allow the U.S. to stop a product from being sold if it was made using American technology.
After the report the Global X Asia Semiconductor exchange-traded fund 3119.HK closed down 1.74% on Thursday with declines in major holdings including SK Hynix 000660.KS, Tokyo Electron, Taiwan Semiconductor Manufacturing Co (TSMC) 2330.TW, and Samsung Electronics 005930.KS.
The Philadelphia Semiconductor index had fallen 6.8% on Wednesday for its weakest day since March 2020. The index had opened up 1.7% on Thursday before falling more than 1% at its low for the day and then closing the session up 0.5%. Its biggest boosts were from Broadcom, up 2.9%, and Nvidia up 2.6%.
Their gains helped offset declines in stocks such as Advanced Micro Devices AMD.O, which closed down 2.2% after falling more than 10% on Wednesday, in its biggest sell-off since October 2022.
Some analysts cited Wednesday's sell-off as a signal to bargain hunt. Vedvati Shrotre at Evercore ISI wrote that the near-term probability the trade curbs would be implemented is low and pointed to "near-term weakness as a unique buying opportunity." Also Vivek Arya at Bofa cited current volatility as "enhanced opportunity in companies with best-profitability."
But Daniel Morgan, portfolio manager at Synovus Trust expects more volatility ahead with chip company earnings due in coming weeks and both U.S. Presidential candidates, Donald Trump and Joe Biden, "taking a tough line" on trade.
"What you were seeing is buying on the weakness and then investors coming to the awareness that this is going to be a recurring concern as we head into the reporting season, that companies with a high level of sales exposure to China may be hurt," said Atlanta, Georgia based Morgan.
He pointed to an almost 11% tumble in shares of ASML ASML.AS on Wednesday to illustrate worries about chip companies that disclose big exposure to China. Investors overlooked strong results at ASML, the biggest supplier of computer chip- making equipment, because roughly half its sales came from China, Morgan said.
But he noted that investors were equally worried about Trump implementing tariffs when he was President yet "chip companies have survived and have done extremely well since then."
Some of Thursday's volatility may have been caused by investor fears that U.S. presidential candidate Donald Trump would make comments about trade in a speech scheduled for later in the day, said Gene Goldman, chief investment officer at Cetera Investment Management, El Segundo, CA
"He may suggest more tariffs, which is a concern for technology companies," said Goldman.
TSMC, the world's largest contract chipmaker, has already come under pressure from comments from Trump who said earlier this week that Taiwan "did take about 100% of our chip business" and should pay the U.S. for its defence.
On Thursday TSMC showed some of the biggest declines in Asia, shedding T$1.7 trillion ($52.1 billion) market value in two days. But the manufacturer's U.S. traded shares TSM.N closed up 0.4% on Thursday.
It likely helped that TSMC, the world's largest contract chipmaker, raised its full-year revenue forecast on Thursday on surging artificial intelligence (AI) related demand for chips.
In Europe ASML shares had closed down 3.6% in Europe on Thursday while its U.S. listed shares ended down 0.9%.
In Asia, South Korean memory chipmaker SK Hynix had also slid 3.6% while Japan's Tokyo Electron, had slumped 8.75%.
TSMC stocks selloff in the wake of Trump comments https://tmsnrt.rs/3xYKyyj
Chip dip https://tmsnrt.rs/4fcnDjR
Reporting by Sinéad Carew and Saqib Iqbal Ahmed in New York, Youn Ah Moon and Joyce Lee in Seoul, Jeanny Kao in Taipei, Ankur Banerjee in Singapore and Alun John in London; Writing by Rae Wee; Editing by David Evans and Stephen Coates
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دستبرداری: XM Group کے ادارے ہماری آن لائن تجارت کی سہولت تک صرف عملدرآمد کی خدمت اور رسائی مہیا کرتے ہیں، کسی شخص کو ویب سائٹ پر یا اس کے ذریعے دستیاب کانٹینٹ کو دیکھنے اور/یا استعمال کرنے کی اجازت دیتا ہے، اس پر تبدیل یا توسیع کا ارادہ نہیں ہے ، اور نہ ہی یہ تبدیل ہوتا ہے یا اس پر وسعت کریں۔ اس طرح کی رسائی اور استعمال ہمیشہ مشروط ہوتا ہے: (i) شرائط و ضوابط؛ (ii) خطرہ انتباہات؛ اور (iii) مکمل دستبرداری۔ لہذا اس طرح کے مواد کو عام معلومات سے زیادہ کے طور پر فراہم کیا جاتا ہے۔ خاص طور پر، براہ کرم آگاہ رہیں کہ ہماری آن لائن تجارت کی سہولت کے مندرجات نہ تو کوئی درخواست ہے، اور نہ ہی فنانشل مارکیٹ میں کوئی لین دین داخل کرنے کی پیش کش ہے۔ کسی بھی فنانشل مارکیٹ میں تجارت میں آپ کے سرمائے کے لئے ایک خاص سطح کا خطرہ ہوتا ہے۔
ہماری آن لائن تجارتی سہولت پر شائع ہونے والے تمام مٹیریل کا مقصد صرف تعلیمی/معلوماتی مقاصد کے لئے ہے، اور اس میں شامل نہیں ہے — اور نہ ہی اسے فنانشل، سرمایہ کاری ٹیکس یا تجارتی مشورے اور سفارشات؛ یا ہماری تجارتی قیمتوں کا ریکارڈ؛ یا کسی بھی فنانشل انسٹرومنٹ میں لین دین کی پیشکش؛ یا اسکے لئے مانگ؛ یا غیر متنازعہ مالی تشہیرات پر مشتمل سمجھا جانا چاہئے۔
کوئی تھرڈ پارٹی کانٹینٹ، نیز XM کے ذریعہ تیار کردہ کانٹینٹ، جیسے: راۓ، خبریں، تحقیق، تجزیہ، قیمتیں اور دیگر معلومات یا اس ویب سائٹ پر مشتمل تھرڈ پارٹی کے سائٹس کے لنکس کو "جیسے ہے" کی بنیاد پر فراہم کیا جاتا ہے، عام مارکیٹ کی تفسیر کے طور پر، اور سرمایہ کاری کے مشورے کو تشکیل نہ دیں۔ اس حد تک کہ کسی بھی کانٹینٹ کو سرمایہ کاری کی تحقیقات کے طور پر سمجھا جاتا ہے، آپ کو نوٹ کرنا اور قبول کرنا ہوگا کہ یہ کانٹینٹ سرمایہ کاری کی تحقیق کی آزادی کو فروغ دینے کے لئے ڈیزائن کردہ قانونی تقاضوں کے مطابق نہیں ہے اور تیار نہیں کیا گیا ہے، اسی طرح، اس پر غور کیا جائے گا بطور متعلقہ قوانین اور ضوابط کے تحت مارکیٹنگ مواصلات۔ براہ کرم یقینی بنائیں کہ آپ غیر آزاد سرمایہ کاری سے متعلق ہماری اطلاع کو پڑھ اور سمجھ چکے ہیں۔ مذکورہ بالا معلومات کے بارے میں تحقیق اور رسک وارننگ ، جس تک رسائی یہاں حاصل کی جا سکتی ہے۔
