Nvidia Supplier Super Micro Computer Stock Is Down Wednesday, What's Going On?
Portfolio Pulse from Anusuya Lahiri
Super Micro Computer (SMCI) shares are down due to intensified US semiconductor sanctions against China and criticism from Donald Trump towards Taiwan Semiconductor Manufacturing Company (TSM). The Biden administration is considering the Foreign Direct Product Rule (FDPR) and further sanctions on Chinese chip companies. SMCI is a key supplier for Nvidia and has seen significant growth over the past year. Investors can gain exposure to SMCI through ETFs like Vanguard Mid-Cap Growth ETF (VOT) and iShares Russell Mid-Cap ETF (IWR).
July 17, 2024 | 3:04 pm
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NEGATIVE IMPACT
iShares Russell Mid-Cap ETF, which includes exposure to Super Micro Computer, may experience short-term volatility due to the decline in SMCI shares amid US semiconductor sanctions and Trump's comments.
IWR includes exposure to SMCI, and the decline in SMCI shares due to regulatory concerns may cause short-term volatility in the ETF.
CONFIDENCE 80
IMPORTANCE 50
RELEVANCE 60
NEGATIVE IMPACT
Super Micro Computer shares are down 4% due to US semiconductor sanctions against China and Trump's criticism of Taiwan Semiconductor. The Biden administration's consideration of the FDPR and further sanctions on Chinese chip companies adds to the pressure.
The intensified US semiconductor sanctions and Trump's criticism directly impact SMCI, a key Nvidia supplier. The potential implementation of the FDPR and further sanctions on Chinese chip companies create uncertainty, leading to a short-term negative impact on SMCI's stock price.
CONFIDENCE 95
IMPORTANCE 90
RELEVANCE 100
NEGATIVE IMPACT
Taiwan Semiconductor Manufacturing Company faces criticism from Donald Trump, suggesting it should compensate the U.S. for its defense. This adds to the sector's concerns amid US semiconductor sanctions against China.
Trump's comments add to the existing concerns in the semiconductor sector, potentially affecting TSM's stock price negatively in the short term.
CONFIDENCE 85
IMPORTANCE 70
RELEVANCE 80
NEGATIVE IMPACT
Vanguard Mid-Cap Growth ETF, which includes exposure to Super Micro Computer, may see short-term volatility due to the drop in SMCI shares amid US semiconductor sanctions and Trump's comments.
VOT includes exposure to SMCI, and the drop in SMCI shares due to regulatory concerns may cause short-term volatility in the ETF.
CONFIDENCE 80
IMPORTANCE 50
RELEVANCE 60