China's chip-producing stock jumped up in price, with investors waiting for a wave of God's support

China's chip-producing stock jumped up in price, with investors waiting for a wave of God's support

The visit of the Speaker of the American Parliament, Nancy Pelosi, to Taiwan had a catalytic effect on the Chinese authorities in terms of increasing the motivation for competition in many areas of the economy, so that investors had been actively buying shares in China ' s semi-conductor components for the second day, expecting the PRC Government to literally drown them in subsidies.

In Taiwan, much of the production capacity for the production of semiconductor chips is concentrated, not to mention that some of them are the most advanced in terms of world standards. The PRC authorities need to contrast with the technology alliance that the US proposes to organize Taiwan, attracting the largest local producer in the form of TSMC to American land. The increased competition between China and the US may force the first country to invest more heavily in the development of the national semiconductor industry.

According to Bloomberg, since the start of the bidding on the site in Hong Kong, there has been an increase in the price of 3.3 per cent of the shares of SMIC, which is the largest contract chip manufacturer in China. The U.S. government's interests in the procurement of technological equipment have begun under President Trump, and the new phase of restrictions means that SMIC will not be able to buy outside China equipment suitable for the manufacture of 14 nm and more mature chips. On yesterday's bid, SMIC shares have increased by 4.1 per cent.

The intent to intensify China ' s technological oppression is also reflected in the provisions of the U.S. Semiconductive Industry Promotion Package, which will be signed by President Biden next week and will come into effect, which will prohibit recipients of public subsidies for 10 years from expanding their own production of 28 nm and more modern chips in China, and companies found to be in violation of this requirement will have to return funds to the U.S. budget.

According to analysts, next week, SMIC will report a 30% drop in revenue in the second quarter, as the Chinese economy's general recession could not have bypassed the company. Some related anonymous sources in the past have admitted to the DigitalTimes interview that, in the long run, US restrictions against China will not have a major impact on the economy of the Underwear and National Semiconductor Industry. By remaining with rather old technological equipment, Chinese companies will still be able to expand their industry to levels that will allow the country's strong growth and competitiveness in the international arena.