Shares of Intel (NASDAQ:INTC) and Global Foundries (NASDAQ:GFS) moved higher in premarket U.S. trading on Friday, after a Wall Street Jounal reported that the Trump administration is weighing options to substantially lower U.S. reliance on semiconductor imports by boosting local manufacturing.
Prior to the opening bell, Intel rose by roughly 2.9%, while GlobalFoundries jumped by more than 5%.
European chipmakers, meanwhile, were widely lower in Friday’s session. Dutch lithography equipment manufacturer ASML’s shares edged down in early European trading, while other regional semiconductor players like ASM International and Infineon dipped by more than 1%.
In Asia, leading contract chipmaker Taiwan Semiconductor Manufacturing Co dropped 1.5%. South Korea’s Samsung Electronics stock also fell 3.3%, while SK Hynix shares slumped 5.6%.
The White House is considering a policy that will have chipmakers produce the same number of chips in the U.S. as their customers import from abroad, the WSJ reported, citing people familiar with the matter.
Companies not producing in line with the 1:1 ratio will be subject to a tariff, the WSJ reported.
The plan is largely in line with Trump’s attempts to promote more domestic production in the U.S., with the president having last month slapped a 100% tariffs on all chip imports while exempting companies with U.S. manufacturing from the tariffs.
Commerce Secretary Howard Lutnick has discussed the idea with chip executives, the WSJ reported.
But it remained unclear just how Trump could achieve this goal, given the logistics and unit cost mechanics of overseas chip production. Foreign-made chips stand to be much cheaper than those produced locally due to lower input and labor costs, while setting up the infrastructure required to produce chips is also a time and capital-intensive process.
Source :
https://www.investing.com/news/stock-market-news/intel-rises-premarket-on-report-of-us-plan-to-reduce-reliance-on-chip-imports-4257107
