(Reuters) – Semiconductor equipment maker ASML lowered its annual sales forecast and the U.S. on Tuesday reported that the Biden administration is considering restricting sales of advanced artificial intelligence processors to some countries. Semiconductor stocks fell.
AI chip giant Nvidia fell 4.4%, retreating from its record high in the previous session, when it was on the brink of dethroning Apple as the world’s most valuable company.
Tuesday’s decline was expected to reduce the AI chip giant’s market capitalization by about $138 billion to $3.25 trillion, widening the gap with Apple’s market capitalization of $3.58 trillion.
Other semiconductor companies including AMD, Intel, Arm, Broadcom and Micron also fell 2.3% to 6.2%, pushing the Philadelphia SE Semiconductor Index down nearly 4% and weighing on the Nasdaq index.
ASML’s U.S.-listed shares show that the Dutch company announced earnings ahead of schedule in an apparent error, leading to weak bookings and downward revisions to forecasts, slowing recovery in chip demand outside of the AI field. The stock fell 12% as a result.
Deren Nathan, head of equity research at Hargreaves Lansdown, said: “While ASML’s fat finger error itself is not a cause for concern, the content of the announcement was not reassuring to investors.” .
Separately, Bloomberg News reported on Monday that US authorities are considering introducing caps on licenses to export AI chips to certain countries, primarily in the Persian Gulf region, citing national security concerns. It was reported that
The US government is increasingly concerned that the Middle East could serve as a route for China to obtain advanced US chips, which are prohibited from being shipped directly to Asian countries.
Danny Hewson, head of financial analysis at AJ Bell, said: “The AI revolution is expected to play a huge role in increasing productivity and enabling other technological advances, so the U.S. needs to maintain its lead.” It’s no surprise that we want to do everything we can to help.”
(Reporting by Akash Sriram and Jaspreet Singh in Bengaluru; Editing by Tasim Zahid)
