The Biden administration is considering the strictest trade restrictions on foreign companies that sell chip technologies to China.
REUTERS/Brendan McDermid
US stocks were mostly lower on Wednesday after as tech slid on bad news in the chip sector.
The Biden administration is considering the strictest trade restrictions yet on China and its ability to access semiconductor products that utilize American technology.
The restrictions would limit foreign companies like ASML from selling their EUV lithography machines to China, as the company's founding in 1984 is based on technology developed in America.
Shares of ASML and Nvidia dropped 7% and 4%, respectively.
Meanwhile, comments from former President Donald Trump sent shares of Taiwan Semiconductor lower by about 6% on Wednesday.
In an interview with Bloomberg conducted at the end of June, Trump said Taiwan should pay for US defense, claiming that the country "doesn't give us anything."
Trump also said the country took "about 100% of our chip business."
Taiwan Semiconductor is the largest chip manufacturer in the world, and countless American companies depend on it to manufacture chip designs that are developed in America.
The rally that's taken hold in the broader stock market paused, though the Dow Jones Industrial Average continued to gain early Wednesday.
Investors have enjoyed a wider breadth of stock market gains since last week, when markets began betting on steeper rate cuts from the Federal Reserve. The small-cap Russell 2000 in particular has had a stellar few days, up more than 10% in the last five trading sessions.
Here's where US indexes stood shortly after the 9:30 a.m. opening bell on Wednesday:
Here's what else is going on today:
In commodities, bonds, and crypto:
