A plunge on Wall Street on Friday, led down by technology stocks after a chipmaker warned of a major pullback in the industry, is expected to have an adverse impact on Taiwan’s stock markets this week, analysts said.
Microchip Technology Inc shares on Friday tumbled the most in almost 6 years after the company said product orders missed its forecast, hurt by falling demand in China.
The stock fell 12 percent to US$39.96 at the close in New York, while Philadelphia Semiconductor Index fell 6.9 percent.
Microchip makes semiconductors used in products ranging from home appliances to computer network hardware to cars, so its earnings are a broad indicator of industry demand.
China is the largest market for key products such as smartphones, with factories located there responsible for much of the world’s electronics production.
“The revenue miss was led by China where the September quarter is traditionally the strongest,” Microchip chief executive officer Steve Sanghi said in a statement. “Microchip often sees the turn of the industry ahead of others in the semiconductor industry. We believe that another industry correction has begun and that this correction will be seen more broadly across the industry in the near future.”
The Chandler, Arizona-based company has historically been an early semiconductor cycle indicator, investment research firm Hedgeye Risk Management wrote in a note to investors on Friday.
“Semiconductor downcycles affect all chip firms. Nobody will be spared,” Hedgeye said.
Technology companies are scheduled to begin reporting their third-quarter performance this week, with Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), the world’s biggest contract chipmaker, and camera lens supplier Largan Precision Co’s (大立光) set to announce their results on Thursday.
Hua Nan Securities Investment Management Co (華南投顧) chairman David Chu (儲祥生) said investors should pay attention to TSMC’s investors conference as the company plans to also give its sales guidance for the current quarter.
Additional reporting by CNA
NEW IDENTITY: Known for its software, India has expanded into hardware, with its semiconductor industry growing from US$38bn in 2023 to US$45bn to US$50bn India on Saturday inaugurated its first semiconductor assembly and test facility, a milestone in the government’s push to reduce dependence on foreign chipmakers and stake a claim in a sector dominated by China. Indian Prime Minister Narendra Modi opened US firm Micron Technology Inc’s semiconductor assembly, test and packaging unit in his home state of Gujarat, hailing the “dawn of a new era” for India’s technology ambitions. “When young Indians look back in the future, they will see this decade as the turning point in our tech future,” Modi told the event, which was broadcast on his YouTube channel. The plant would convert
‘SEISMIC SHIFT’: The researcher forecast there would be about 1.1 billion mobile shipments this year, down from 1.26 billion the prior year and erasing years of gains The global smartphone market is expected to contract 12.9 percent this year due to the unprecedented memorychip shortage, marking “a crisis like no other,” researcher International Data Corp (IDC) said. The new forecast, a dramatic revision down from earlier estimates, gives the latest accounting of the ongoing memory crunch that is affecting every corner of the electronics industry. The demand for advanced memory to power artificial intelligence (AI) tasks has drained global supply until well into next year and jeopardizes the business model of many smartphone makers. IDC forecast about 1.1 billion mobile shipments this year, down from 1.26 billion the prior
People stand in a Pokemon store in Tokyo on Thursday. One of the world highest-grossing franchises is celebrated its 30th anniversary yesterday.
Zimbabwe’s ban on raw lithium exports is forcing Chinese miners to rethink their strategy, speeding up plans to process the metal locally instead of shipping it to China’s vast rechargeable battery industry. The country is Africa’s largest lithium producer and has one of the world’s largest reserves, according to the US Geological Survey (USGS). Zimbabwe already banned the export of lithium ore in 2022 and last year announced it would halt exports of lithium concentrates from January next year. However, on Wednesday it imposed the ban with immediate effect, leaving unclear what the lithium mining sector would do in the
RSS