China chip stocks rally after Beijing said U.S. chip giant Micron is ‘main security threat’
Micron Technology Double-Data-Rate Synchronous Random-Access Memory (SDRAM) chip
Tomohiro Ohsumi | Bloomberg | Getty Images
China’s chip stocks rallied on Monday morning following Beijing’s announcement to bar some purchases of merchandise from U.S. reminiscence chipmaker Micron.
China’s Cyberspace Administration barred operators of “crucial data infrastructure” in China from shopping for merchandise from the U.S. chip giant following a security assessment carried out by the Cyberspace Administration of China.
Chinese authorities said Micron merchandise have failed its community security assessment, and cited “severe potential community security points.” The agency poses a “main security threat” to China’s crucial data infrastructure provide chain and impacts [its] nationwide security,” a press release said.
Shares of Chinese chipmakers largely rose on Monday following the transfer: Hong Kong-listed Hua Hong Semiconductor rose as a lot as 3.14% on Monday, whereas SMIC rose 2.64%.
Other reminiscence chip producers in mainland China equivalent to GigaDevice Semiconductor and Ingenic semiconductor jumped 3.74% and eight.08% respectively.
In response to Beijing’s announcement, the U.S. Commerce Secretary Gina Raimondo informed the Wall Street Journal, “We firmly oppose restrictions that haven’t any foundation in reality.” The commerce division will have interaction with the Chinese authorities to “element” its place and search additional readability, he added.
Raimondo said the U.S. will have interaction with its key allies to handle Beijing’s actions, and that such measures will trigger “distortions of the reminiscence chip market.”
This comes because the U.S. reportedly urged South Korean chipmakers to not fill the shortfalls in China if Beijing’s ban comes into impact, the Financial Times reported.
Shares of South Korean chipmakers SK Hynix and Samsung Electronics, each Micron rivals, rose on Monday morning.