Semiconductor stocks have performed stupendously even amid a shortage of auto chip production and wild market fluctuations related to short trading of shares of GameStop and other companies in recent days.
In one example, Intel shares climbed nearly 5% on Thursday, reaching 56.30 mid-day and making it a leader in trading on the Nasdaq market.
The Philadelphia Semiconductor Sector index of 30 major chipmaker stocks also jumped by 3%, trading mid-day Thursday at 2950.71.
Over the past year, shares on the chip index have more than doubled from 1,286.84 on March 19, 2020, to its close on Wednesday at 2,875.
Chip company sales are also climbing. Sales overall “continued a steep upward track” for the third week of January, up by 20% over the prior week, noted VLSI Research in a recent note. NAND chips were up by 14% year-over-year.
However, auto chips haven’t shown a rise in year-over-year growth, VLSI said on Wednesday.
The analyst firm said in a note on Tuesday that the widely-reported shortage in auto integrated circuits “reaches deep into the supply chain.” New chips won’t reach auto manufacturers as packaged modules until April, VLSI said.
In addition, foundries are adding capacity for 300 mm wafers which will be ramping up by June, making modules available for autos by the September-October time frame, VLSI said. More capacity for 200 mm wafer capacity will be constrained indefinitely due to lack of tools, VLSI added.
In the example of major chipmaker TSMC, VLSI said, orders for chips from automakers didn’t arrive until fourth quarter 2020 following shutdowns on auto assembly lines in spring 2020. When those orders did arrive in the fourth quarter, TSMC’s manufacturing pipeline was already full from other customers, especially for 5G chip orders.
GameStop shares fell 30% on Thursday after trading was stopped several times. In recent days the stock rose more than 300%, but started to decline on Thursday as Robinhood and other retail brokerages restricted trading on GameStop and others.
The GameStop trading frenzy apparently dragged markets down on Wednesday. Overnight, shares of the stock rose as above $500 and fell below $290 after the opening bell on Thursday. GameStock shares had been shorted, along with AMC Entertainment, BlackBerry and Koss.
On Wednesday, traders on the major markets saw the biggest sell-off in three months, but 24 hours later, the Dow, S&P and Nasdaq were all surging mid-afternoon on Thursday. Apple apparently was hit by the market decline despite strong fourth quarter earnings reported on Wednesday. Shares closed at 142.06 on Wednesday and opened Thursday at 138.31.
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