Shares of a number of global companies that work with chips went up sharply on Thursday after news came out that U.S. officials are thinking about loosening limits on sales to China.
2.42 percent of ASML Holding NV shares Around the world, ASML went up more than 4% and ASM International NV ASM 1.07% went up more than 3%. In Japan, Kokusai Electric Corp. 6525 (12.64%) went up 12%, Tokyo Electron Ltd 8035 (6.74%), and SCREEN Holdings Co., Ltd 7735 (6.25%). All of these companies saw gains of over 6%.
Bloomberg said that the U.S. government was thinking about more steps to stop selling chip equipment and AI memory chips to China. This led to the gains, but the steps may not be as strict as first planned.
Sources told the story that officials from the US, Japan, and the Netherlands have been talking about the limits for months. U.S. companies that make chip equipment, like Lam Research Corp. LRCX -1.54% and Applied Materials Inc. AMAT -1.09%, say that they would lose out to Dutch and Japanese chip giants whose governments have not yet agreed to tougher rules for China. On Wednesday, shares of all of those companies went down more than 1%. The markets in the United States are closed on Thursday in honor of Thanksgiving Day.
The newest plans would only punish a smaller number of providers to Huawei Technologies Co., while ChangXin Memory Technologies Inc. is one of the companies that would not be affected. Sources say that the new plan will put limits on two chip factories run by Semiconductor Manufacturing International Corp. In Hong Kong on Thursday, Semiconductor Manufacturing International 981 -2.14% shares fell more than 2%.
The report said that other companies that would be caught include Chinese companies that make tools for making semiconductors instead of companies that make chips.
Sources say that the new rules will also hurt companies that make high-bandwidth memory chips, like Micron Technology Inc. MU -3.54%. On Thursday, shares of Samsung Electronics Co. 005930 -1.42% and SK Hynix Inc. 000660 -4.28%, two Korean competitors in the same field, dropped 1% and 4% all around.
Over the past few years, the Biden administration has tried to limit China’s access to chips that power AI, and most people don’t think that will change under Trump’s government.
Bloomberg heard from sources that the new rules might start next week, but things could change before then.
