Advertisement
Shares of ASML surged by up to 10% on Wednesday following a Reuters report suggesting that the U.S. may exempt certain allies from expanded export restrictions on semiconductor equipment to China.
According to the report, the U.S. is considering extending the foreign direct product rule, which would impact exports to China from countries like Israel, Taiwan, Singapore, and Malaysia. However, allies including Japan, the Netherlands, and South Korea might be excluded from these new restrictions.
The foreign direct product rule stipulates that any company utilizing even a small amount of American technology in the production of semiconductor-related products may face limitations on exporting these goods to China. This rule significantly affects foreign companies, as they often depend on American technology for their operations.
ASML, headquartered in the Netherlands and a critical player in the semiconductor industry due to its production of advanced chipmaking machinery, saw its shares rise approximately 7% following the Reuters report. The potential exemption could allow ASML to continue its operations with China, which is a major market for its equipment.
Tokyo Electron, a semiconductor equipment maker based in Japan, also experienced a boost, with its shares closing more than 7% higher on Thursday. Both ASML and Tokyo Electron had previously seen declines following a Bloomberg report earlier in the month that suggested a broader inclusion of countries in the export restrictions.
The semiconductor sector remains a focal point in the ongoing technology trade tensions between the U.S. and China. The potential policy shift is seen as a significant development for semiconductor firms operating globally.
Shares of South Korean memory chip manufacturers Samsung and SK Hynix also saw gains following the Reuters report, adding to Samsung’s earlier boost from strong second-quarter earnings that exceeded market expectations.