U.S. stock futures were lower this morning, with the Nasdaq futures falling around 300 points on Wednesday.
The tech and chip stock rally that has far outstripped the rest of the market so far this year looked set to come to a juddering halt on Wednesday.
Shares of ASML—Europe's most valuable tech company and maker of the world's most advanced chip-making machines—slumped more than 6% early Wednesday following reports that President Joe Biden may be mulling even harsher trade restrictions to further limit China's ability to manufacture powerful semiconductors.
Semiconductor equipment leader ASML beat Wall Street's targets for the second quarter but missed views with its sales guidance.
ASML Holding NV (NASDAQ:ASML) shares have plummeted more than 7% despite rallying in the pre market on a bumper second-quarter financial update. Sales in the quarter surged 18% as the Dutch lithographic machinery supplier to the cutting-edge semiconductor manufacturing industry benefited from an ongoing boom in artificial intelligence microchip demand.
Stocks in the AI industry have seen huge gains in recent years. A recent report by PWC estimated the sector could contribute up to $15.7 trillion to global gross domestic product.
ASML's orders and earnings beat expectations but it is also being hit by fears of stricter limits on chipmaking equipment exports.
Dutch technology giant ASML Holding NV (NASDAQ:ASML), the supplier of high-end lithographic machinery used to manufacture computer chips, had another strong quarter, with sales reaching the high end of guidance at €6.2 billion (£5.2 billion). It marks an 18% year on year increase in revenues, net income coming in 29% higher at €1.6 billion.
ASML reported second-quarter earnings and sales that beat forecasts as it continues to see a recovery in demand for its machines that are required to make the world's most advanced chips. In this article ASML-NL
ASML , the largest equipment supplier to chipmakers, on Wednesday reported better-than-expected second-quarter net income of 1.6 billion euros ($1.7 billion) on revenues of 6.2 billion euros, while new bookings rose.
ASML, SAP, Nvidia, Vertex and EssilorLuxxottica are included in this Analyst Blog.
The market leader's shares have paused their rally over the past month but catalysts could come from elsewhere.