Chipmaker stocks fall on fears of Chinese retaliation against Huawei order

Integrated circuits on a printed circuit board. The semiconductor industry has been at the center of the US-China trade war.

filonmar | E + | Getty Images

Computer hardware and semiconductor stocks plummeted on Friday after the Trump administration blocked chip deliveries to Chinese tech champion Huawei, raising fears that the Chinese government could retaliate and hurt American companies with additional restrictions.

Qualcomm fell more than 5% and Intel lost more than 2% on Friday afternoon. Several small hardware companies also fell on Friday, including Micron (by more than 3%), Lam Research (by more than 5%) and Qorvo (by about 4%).

This decline reflects the uncertainty faced by stocks heavily dependent on the Chinese market as the United States and China compete in the final chapter of the trade war. Qualcomm is also currently in a patent license dispute with Huawei.

On Thursday, the Trump administration decided to block semiconductor shipments to Huawei by chip makers using U.S. software and technology. Huawei needs imported parts and software for its smartphones and telecommunications infrastructure products.

In response, China has reportedly investigated a response against US companies using the “list of untrusted entities”, which would harm US companies such as Qualcomm, Cisco and Apple, according to the State-run Global Times.

Apple lost just over 1% in Friday’s session. Cisco was flat.

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