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Asian Tech Stocks Decline Amid U.S. Tariff Announcement
On August 10, 2012, employees were seen moving semiconductor testers along the assembly line of the Advantest Corp. plant in Ora, Japan, illustrating the ongoing evolution of the semiconductor industry.
In a significant market development, Asian technology and chip-related stocks experienced a downturn on Tuesday following U.S. President Donald Trump’s reaffirmation of tariffs set to be imposed on goods from Mexico and Canada. This announcement has reverberated through the global tech market, heightening concerns over escalating trade tensions.
President Trump announced a 25% tariff on imports from both Canada and Mexico, declaring a hardline stance with no possibility for negotiation. In addition to these tariffs, he indicated plans for an additional 10% duty on Chinese imports, building on a previous 10% tariff implemented earlier in the year.
The announcement particularly affected Asian tech stocks, further compounded by a roughly 9% drop in shares of Nvidia, a leading player in the artificial intelligence sector. Such declines have typically reverberated through the semiconductor supply chain, affecting companies reliant on external components.
Among the impacted firms, Japanese semiconductor manufacturer Advantest saw its shares plunge up to 9%, marking its lowest price since October of the previous year. Additionally, Renesas Electronics, another chipmaker, experienced a decline of 6.35%. SoftBank Group, a significant tech investor, also faced a drop of 6.25%. CEO Masayoshi Son is reported to be seeking $16 billion in loans to fund investments in artificial intelligence, signaling the company’s intent to double down on this emerging sector.
In South Korea, shares of SK Hynix fell by up to 3.26%. However, Samsung Electronics experienced a slight uptick of nearly 1% following the introduction of its Galaxy A series smartphones, which feature AI-enhanced capabilities.
Chinese tech stocks also felt the impact, with shares of Alibaba and Kingsoft Cloud decreasing by 2.23% and 8.46%, respectively. Other losses were noted as the Chinese shopping platform Meituan dipped by 0.62%, while electric vehicle manufacturers faced steep declines: BYD dropped 6.60%, Xpeng fell 1.97%, and Li Auto was down by 2.68%. Contrasting this trend, Tencent’s shares rose by 0.91% in Hong Kong, showcasing some resilience within the tech sector.
In Taiwan, the Taiwan Semiconductor Manufacturing Company (TSMC) experienced a loss of more than 2% on the day of the tariff announcement. This followed Trump’s acknowledgment that TSMC would be investing $100 billion in U.S. chip production, a move he described as significant for the most powerful company in the global semiconductor market.
As these developments unfold, it remains to be seen how the ongoing trade tensions will further influence the Asian technology sector and global supply chains, particularly as firms navigate the complexities of international trade and investment in an increasingly interconnected world.
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