ASML Stock Jumps as US Expected to Exempt Some Nations From Chip-Equipment Export Curbs

Shares of Dutch semiconductor-gear maker ASML Holding (ASML) are soaring in early Wednesday trading on a report that the U.S. is on track to exclude chip-equipment makers in the Netherlands and elsewhere from its latest set of trade curbs aimed at reining in China’s tech advance.

According to Reuters, shipments from several countries that export key chipmaking equipment, also including, Japan, and South Korea, won’t be included in a Biden administration expansion of the Foreign Direct Product Rule next month.

Expanded Curbs Would Hit Taiwan, Israel, Singapore Exports

The expansion will prevent around half a dozen Chinese fabs from getting exports from many countries, the report said. Places whose exports would be affected would include Taiwan, Israel, Singapore, and Malaysia. Taiwan is home to chip manufacturing giant Taiwan Semiconductor Manufacturing Company (TSM).

ASML shares had been struggling after Bloomberg reported earlier this month that that the Biden administration’s upcoming stricter curbs on China access to foreign chipmakers’ exports would be used to crack down on the Chineses businesses of ASML and Japan’s Tokyo Electron.

The Commerce Department didn’t immediately respond to a request for comment Wednesday.

Exemption from China Chip Curbs to Remove Overhang, Says Jefferies

Wednesday’s report from Reuters suggests ASML and Tokyo Electron will be shielded from the new rules, Jefferies analysts said in a note, “removing a key negative on these stocks that have led to significant underperformance in recent weeks.”

Shares in ASML, which makes extreme ultraviolet (EUV) lithography machines that can produce smaller and more powerful microchips are up more than 20% this year. Tokyo Electron, whose etching machines are used in semiconductor factories, closed up 7% in Japanese trade.