Chip stocks try to rebound as TSMC earnings lift hopes after steep sell-off
Nvidia and TSMC rose nearly 3%, while AMD and Intel rose about 1% on Thursday morning.
TSMC reported a 36% rise in quarterly profit, and raised its full-year guidance for revenue growth.
Chip stocks tumbled Wednesday after Trump said Taiwan took "about 100% of our chip business"
Chip stocks were up on Thursday after the sector sold off sharply in the previous session on fears of a widening crackdown on trade with China.
Chip stocks tumbled across the board Wednesday. Nvidia shares fell 6.62%, while TSM and AMD's shares fell almost 8% and over 10%, respectively.
Investors on Thursday, however, were looking to stage a rebound, with shares of Nvidia and TSM up about 2%, while AMD and Intel rose about 1%.
The rebound comes after TSMC reported strong second-quarter earnings, with a 36% year-over-year rise in quarterly profit. The jump in profit is a result of its strong chip sales, as its high performance computing segment saw a 28% rise in sales for last quarter.
TSMC seems to be betting on the AI industry continuing to grow, upping its full-year revenue growth projections from low- to mid-20% up to mid-20%. The company projects between $22.4 billion to$23.2 billion in third-quarter revenue.
TSMC shares fell sharply Wednesday after Donald Trump said in an interview published by Bloomberg that Taiwan "did take about 100% of our chip business," and the country should pay the US for its defense. TSMC stock traded in Taiwan was down over 2% Thursday.
Semiconductor names suffered broadly on Wednesday after reports that President Joe Biden's administration is considering stricter controls on trade with China.
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