The Chinese flag is displayed next to the “Made in China” mark that appears on a printed circuit board containing semiconductor chips, in this illustration taken on February 17, 2023.
Florence Lou | Reuters
Major Asian chip stocks outside China rose on Tuesday, shrugging off a new round of US restrictions on semiconductor exports to Beijing aimed at weakening the country's ability to produce some advanced chips.
Taiwan Semiconductor Manufacturing Company — the world's largest contract chip supplier — saw shares rise 2.4%.
Several Japanese chip-related stocks also rose. Tokyo Electron shares rose 4.7%. Lasertech Advantest shares rose 6.7%, Advantest shares increased 3.9%, and Renesas Electron shares advanced 2.2%.
Japanese technology conglomerate Softbankwhich owns a stake in British chip designer Arm, its shares rose 3.6%.
The latest restrictions imposed by the Biden administration will also target sales of high-bandwidth memory chips, which could affect the world's two largest memory chip manufacturers – SK Hynix and South Korea's Samsung.
However, Samsung Electronics and SK Hynix shares rose 0.9% and 1.8%, respectively.
High-bandwidth memory controls will impact South Korean players to some extent, Derek Irwin, portfolio manager at Allspring Global Investments, told CNBC's “Street Signs Asia” on Tuesday.
“While we believe the impact and sales of high-bandwidth memory chips in China are reasonably small than those players in the scheme of things, they will likely be able to shift that demand to the US and other markets,” he said. .
The Commerce Department announced Monday that it will restrict semiconductor exports to 140 new companies in its latest effort to limit China's access to advanced chip technology that can be used to develop its military capabilities.
Noura Technology Group, Biotechnology ACM Research was among the largest Chinese companies placed on the export controls list.
Naura Technology and ACM Research shares fell 3% and 1%, respectively, in China while Piotech shares rose 1%. Shares of China's largest chipmaker, International Semiconductor Manufacturing Company, fell 1.5% in Hong Kong.
US Commerce Secretary Gina Raimondo said Monday that the new export controls were “the culmination of the Biden-Harris administration's targeted approach to weaken the People's Republic of China's ability to localize production of advanced technologies that pose a risk to our national security.”
In addition to the added entities, the latest US restrictions include new controls on 24 types of manufacturing equipment and three types of software tools used for semiconductor development.
Last month, the effectiveness of chip restrictions in the US was called into question when it was reported that a chip produced by TSMC had been found in a Huawei product.
The latest export restrictions include new “red flag guidance” to address compliance concerns, and several “critical regulatory changes” to enhance the effectiveness of existing controls.
