Investing.com – Chip stocks swung lower on Friday on a report that the U.S. government is looking at measures to stop foreign companies from supplying equipment to key Chinese chip customer Huawei.
The U.S. government is considering measures to stop foreign companies from supplying equipment to Huawei – an important customer for a number of U.S. semiconductor companies – amid concerns the current blacklisting has failed to cut off supplies to the Chinese telecom giant, Reuters reported, citing two sources.
The Philadelphia Semiconductor Index was down nearly 1%, with Huawei-sensitive companies like Intel (NASDAQ:INTC) and Micron (NASDAQ:MU) down about 0.7% and 1.4% respectively.
The news offset some of the optimism seen last week, when the Trump Administration agreed to grant some reprieves to Huawei, extending a temporary general license for 90 days. The temporary general license, granted in September, lifted the ban on U.S. companies from selling or transferring technology to Huawei.
Semis started the day on the back foot after sentiment on U.S. and China trade relations soured as Beijing vowed to retaliate against the U.S. after President Donald Trump signed two bills into law in support of Hong Kong protesters.