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Semiconductor Stocks Decline Amid Trade War Fears

Semiconductor stocks tumbled on Monday as President Donald Trump’s tariffs on Mexico, Canada, and China intensified trade tensions, sparking investor uncertainty.

Key Market Moves

  • Nvidia (NVDA): Down 2%
  • AMD (AMD): Down 1.6%
  • Broadcom (AVGO): Down 2%
  • Qualcomm (QCOM): Down 1.9%
  • Texas Instruments (TXN): Down 1.4%
  • Intel (INTC): Down 1.4%
  • TSMC: Down 2.6%
  • ASML: Down 2%
  • Arm Holdings: Down 3%
  • iShares Semiconductor ETF (SOXX): Down 2.2%

Why Are Chip Stocks Falling?

  1. Tariff Shock
    • Higher costs on semiconductors & components.
    • Disruptions to supply chains, especially for global chipmakers.
  2. Trade War Concerns
    • Trump signaled tariffs on Europe could be next, raising broader economic risks.
    • Semiconductor supply chains rely on cross-border production, making them highly vulnerable to tariffs at multiple stages.
  3. Investor Uncertainty
    • Market sell-off reflects concerns over supply chain bottlenecks.
    • Potential for higher production costs & logistical challenges in the tech sector.

Market Outlook

Future trade policy decisions from the White House.

Short-Term: Continued volatility as investors assess tariff impacts.

Long-Term: Potential shifts in supply chains, as chipmakers explore alternative manufacturing strategies to mitigate tariff risks.

Key Watchpoints:

Possible U.S.-EU tariffs and their impact on European chipmakers.

China’s reaction after its Lunar New Year market reopening.

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