US Markets
Wednesday, July 31st, 2024 3:31 pm EDT
Key Points
- Positive Earnings Reports: Global semiconductor stocks surged on Wednesday, driven by strong earnings reports. AMD saw a 5% increase in shares after reporting strong growth in its data center business, while Nvidia and Qualcomm also experienced significant gains.
- Samsung and SK Hynix Performance: Samsung, the world’s largest memory chip maker, reported a 1,458.2% year-on-year increase in second-quarter operating profit, with its shares rising 3.58%. SK Hynix shares also increased by 3%.
- Potential U.S. Export Restrictions: The rally was further supported by a Reuters report suggesting that the U.S. may expand export restrictions on semiconductor-related equipment to China, potentially excluding allies like Japan, the Netherlands, and South Korea from these measures. This contrasted with an earlier Bloomberg report and positively impacted shares of companies like ASML and Tokyo Electron.
On Wednesday, shares of global semiconductor firms surged, buoyed by positive earnings reports and potential easing of U.S. export restrictions on China. AMD led the gains, with its stock rising 5% following a strong second-quarter earnings report that exceeded expectations. The company reported significant growth in its data center business, driven by the demand for its GPUs, which are crucial for training artificial intelligence models. This positive performance also lifted shares of other U.S. chipmakers, including Nvidia and Qualcomm, with Nvidia seeing a notable 10% increase.
In addition to AMD’s success, Samsung reported a remarkable 1,458.2% year-on-year increase in its second-quarter operating profit, driven by its memory chip business, which is essential for AI applications. Samsung’s strong results led to a 3.58% rise in its share price, while shares of its competitor SK Hynix also climbed 3%. The positive momentum in the semiconductor sector was further supported by a Reuters report suggesting that the U.S. might expand a rule restricting the export of semiconductor-related equipment to China. However, the report indicated that U.S. allies, including Japan, the Netherlands, and South Korea, might be excluded from these restrictions, contradicting an earlier Bloomberg report that suggested these countries could also be affected.
This news provided an additional boost to South Korean firms like Samsung and SK Hynix, as well as to Dutch semiconductor equipment maker ASML, whose shares jumped as much as 10%. Japanese chip gear maker Tokyo Electron also saw a significant increase, closing up 7.41%. The combination of strong earnings and a potentially less stringent regulatory environment contributed to the widespread rally in semiconductor stocks, highlighting the sector’s resilience and importance in the global economy.
For the full original article on CNBC, please click here: https://www.cnbc.com/2024/07/31/amd-nvidia-jump-as-chip-stocks-rally-from-earnings-geopolitics-boost.html
