China's technology companies collapsed against the backdrop of new US sanctions

China's technology companies collapsed against the backdrop of new US sanctions

Following President Joe Biden ' s announcement last Friday of an increase in sanctions against China ' s semiconductor industry, as well as restrictions on the supply of supercomputer components to the Underwear, there was a sharp fall in the shares of chip manufacturers, as well as Chinese technological giants, including the Albaba Group and Tencent.

According to Reuters analysts, the fall is due to investors' fears about the effects of new US export restrictions aimed at slowing the technological and military growth of Beijing. US restrictions, some of which have immediate effects, are the biggest change in US technology supply policy to China since the 1990s.

Experts believe that the imposition of sanctions would significantly reduce China ' s capacity to develop its own chip production, as well as impact commercial and State research in the fields of armaments, artificial intelligence, CDCs and other areas, which are carried out using supercomputers and high-productivity chips. Citi analysts noted.

First of all, the leading Chinese contract producers of chips, such as Semiconducor Manufacturing International Corp, will be affected by SMIC stock drops by 3.8 per cent in 24 hours, Hua Hong Semiconducor by 9.5 per cent, NAURA Technology Group chip manufacturer by 10 per cent, and YMTC and CXMT in China have high expectations that they will be able to compete with Samsung Electronics and Microsoft Technology market leaders in the future.

It should also be noted that the world chip industry is already experiencing bad times because of the declining demand for computers, smartphones and other electronic devices after the COVID pandemic.

Industry experts argue that sanctions may affect the commercial CDIs of Chinese technological giants, Alibaba and Tencent, which depend heavily on the work of the CDI, fell by 3.3 per cent and 1.7 per cent respectively, adding that the shares of the Chinese company Sensetime, a research company in the area of IE, and the manufacturer of Dahua Technology video surveillance equipment, which depend on American technology, fell by 4.4 per cent and 10 per cent respectively.