- author, Joao da Silva
- role, Business reporter
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Technology stocks around the world are falling on concerns about the global computer chip industry.
The sell-off came on the back of reports that the Biden administration may further tighten export controls on semiconductor equipment to China.
Concerns were also fuelled by comments from former US President Donald Trump that Taiwan, the largest semiconductor producer, should pay for its own defence costs.
In the United States, the tech-heavy Nasdaq index closed down 2.7% on Wednesday, while semiconductor stocks also fell sharply in Europe and Asia.
“I think the U.S. will tighten some regulations regardless of the election outcome,” said Bob O’Donnell, principal analyst at Technalysis Research.
“But how far they will take it is the big question.”
In Asia, shares in chipmaker TSMC fell 2.4 percent on Thursday, while equipment maker Tokyo Electron fell 8.8 percent.
This comes after Nvidia shares closed down 6.6% in New York on Wednesday, while AMD shares fell more than 10%.
In Europe, shares in ASML, a maker of semiconductor manufacturing equipment, fell about 11%.
The drop came after Bloomberg News reported on Wednesday that the U.S. government is preparing to impose its toughest ever restrictions on semiconductor manufacturing equipment bound for China if companies such as ASML and Tokyo Electron continue to give China access to advanced semiconductor technology.
The US Department of Commerce, ASML and Tokyo Electron declined to comment when contacted by BBC News.
The Biden administration has previously taken steps to limit China’s access to advanced semiconductor technology.
In October, it imposed restrictions on exports to China of advanced semiconductors used in artificial intelligence (AI) technology.
Trump’s remarks about Taiwan also suggested possible disruptions to global semiconductor supplies.
Taiwan produces most of the world’s advanced chips.
“Investors always react to any comments coming from the U.S., but despite these comments, the long-term business trends in the semiconductor industry are clearly upwards,” said Marco Metzger, executive vice president at memory chip technology company Neu Monda.
