China has initiated two significant investigations targeting the U.S. semiconductor industry, coinciding with ongoing trade discussions between the two nations. The Ministry of Commerce has launched an anti-dumping investigation into specific U.S.-produced analog chips, notably those manufactured by major players in the field. Additionally, a separate inquiry into U.S. restrictions on integrated circuits has been put in motion, highlighting concerns over recent measures, including export controls.
These investigations arise on the heels of new restrictions imposed by the U.S. Commerce Department, which recently added 23 Chinese companies to its trade blacklist. This includes limitations on certain Chinese chip manufacturers regarding the importation of U.S. chipmaking equipment. The U.S. has enacted stringent controls on the export of advanced chips, particularly those used for artificial intelligence, impacting well-known companies in the sector.
Interestingly, the Trump administration’s approval of Nvidia to sell a specific AI chip to China marks a rare exception amidst the stringent controls. However, the Chinese government has advised its companies against purchasing this chip, indicative of the ongoing complexities in the tech trade relationship.
The timing of these probes raises concerns about heightened tensions as U.S. Treasury Secretary Scott Bessent and Chinese Vice Premier He Lifeng prepare for upcoming negotiations in Madrid, addressing tariffs, export controls, and various economic issues.
In the semiconductor stock market, some companies are facing challenges. For instance, Analog Devices saw a slight decline last week, slipping below a critical buy point, while Texas Instruments also experienced a drop, positioned below key moving averages. Conversely, Nvidia demonstrated resilience with a notable increase, regaining some ground, and showing potential for further growth. AMD, while also experiencing gains, remains in a precarious position as it seeks to stabilize above crucial moving averages.
As the landscape of international trade evolves, particularly within the tech sector, investors should closely monitor these developments and adjust their strategies accordingly, as the outcomes of the U.S.-China talks could significantly influence market dynamics in the semiconductor industry.
