(Bloomberg) -- Chinese semiconductor stocks declined after fresh US curbs on China’s access to American technology added to a disappointing start to the earnings season, stoking concerns that the industry’s downturn is far from over.
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Bellwether Semiconductor Manufacturing International Corp. slumped as much as 5.2% in Hong Kong on Monday, the most since Aug. 15. That compares with a 6.1% drop in the Philadelphia Semiconductor Index on Oct. 7, the most in almost a month following strong labor market data that reinforced expectations for more aggressive interest rate hikes by the Federal Reserve.
Hua Hong Semiconductor Ltd. and Shanghai Fudan Microelectronics Group Co. plunged more than 8% each in Hong Kong. Will Semiconductor Co. fell as much as 6.7% in Shanghai.
US measures include restrictions on the export of some types of chips used in artificial intelligence and supercomputing, and also tighter rules on the sale of semiconductor equipment to any Chinese company. Separately, the US also added more Chinese firms to a list of companies that it regards as “unverified,” which means US suppliers will face new hurdles in selling technologies to those entities.
Chinese Foreign Ministry spokesperson Mao Ning said Saturday that the measures, which are set to enter into force this month, are unfair and will “also hurt the interests of US companies,” according to an official briefing transcript. They “deal a blow to global industrial and supply chains and world economic recovery,” she said.
The new US rules come at a time when the chip industry is already grappling with an ominous start to the earnings season. Samsung Electronics Co., the world’s largest memory-chip maker, and PC-processor maker Advanced Micro Devices Inc. reported results last week that suggested a deeper-than-feared slowdown ahead.
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Chinese stocks may anchor the sector globally on Monday as markets of Japan, South Korea, Taiwan and Malaysia are closed.
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