Following stellar performance in 2023, U.S. semiconductor stocks have taken a hit at the start of 2024, with notable declines in Tuesday morning trading in New York. This downturn comes in the wake of the White House’s directive to a prominent European chipmaker, signaling escalating U.S.-China trade tensions.
What Happened: NVIDIA Corp. (NASDAQ:NVDA) witnessed a decline of 4%, while Advanced Micro Devices Inc. (NASDAQ:AMD) experienced a sharper drop of over 5%. Overall, the largest U.S.-traded 25 semiconductor companies have seen nearly $100 billion erased in market value in just the first trading hours of Tuesday.
Chart: Rocky Start To The Year For Major Chipmakers
As Bloomberg reported, Dutch chipmaker supplier ASML Holdings N.V (NASDAQ:ASML) complied with U.S. President Joe Biden‘s request to halt certain shipments to China weeks ahead of a new export ban’s enforcement.
ASML, Europe’s tech giant, confirmed the Dutch government partially revoked licenses for shipping specific lithography systems to China, impacting a few customers. Despite these developments, ASML believes the recent blockade won’t significantly affect its 2023 financial outlook. Shares of ASML Holding N.V. dropped by 4.3%, marking their weakest daily performance since late July.
Why It Matters: In 2023, semiconductor stocks, as tracked by the iShares Semiconductor ETF (NYSE:SOXX), closed with a 66% gain, the best since 2009’s 74% annual increase. Yet the onset of 2024 presents challenges as the market begins to weigh the risks of a potential new tech trade war and its negative influence on the sector’s growth.
US Chipmakers Wipe Out $100 Billion On 2024’s First Trading Day
| Name | Market Cap (in billions) | 1-Day % Change | 1-Day Market Cap Loss (in billions) |
|---|---|---|---|
| NVIDIA Corporation | $1,179.72 | -3.55% | -$41.93 |
| Advanced Micro Devices, Inc. | $225.22 | -5.43% | -$12.22 |
| Broadcom Inc. (NASDAQ:AVGO) | $513.07 | -1.82% | -$9.32 |
| Intel Corporation | $203.19 | -4.09% | -$8.31 |
| Applied Materials, Inc. (NASDAQ:AMAT) | $129.77 | -3.65% | -$4.74 |
| QUALCOMM Incorporated (NASDAQ:QCOM) | $156.73 | -2.63% | -$4.13 |
| Lam Research Corporation (NASDAQ:LRCX) | $99.26 | -3.85% | -$3.82 |
| Micron Technology, Inc. (NASDAQ:MU) | $91.85 | -2.51% | -$2.30 |
| KLA Corporation (NASDAQ:KLAC) | $76.92 | -2.94% | -$2.26 |
| Analog Devices, Inc. (NASDAQ:ADI) | $96.74 | -1.83% | -$1.77 |
| NXP Semiconductors N.V…. |
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