NEW YORK, January 1, 2026, 13:07 ET — Market closed
- The PHLX Semiconductor Index fell 1.2% in the Dec. 31 session, while U.S. markets are shut on Thursday for New Year’s Day.
- Nvidia ended down 0.5%, while Micron slid 2.5% and TSMC’s U.S.-listed shares rose 1.4%.
- Traders are parsing fresh China-related chip headlines, including a Reuters report on Nvidia supply talks with TSMC and a new U.S. license for TSMC’s China tool imports.
U.S. semiconductor stocks slipped in the final trading session of 2025, with the PHLX Semiconductor Index closing down 1.2% on Wednesday. U.S. markets are closed on Thursday for New Year’s Day.
The pullback comes after a year in which AI-linked chipmakers helped power broader equity gains, leaving the group sensitive to profit-taking in thin holiday liquidity. Investors are also entering 2026 with geopolitics and export rules again shaping which products can reach key end-markets.
That matters now because China remains a major buyer of chips and a focal point for U.S. restrictions on advanced semiconductors. Any shift in approvals or licensing can quickly alter near-term shipments, pricing and production plans for the sector.
Nvidia ended down 0.5% on Wednesday after Reuters reported the company has approached Taiwan Semiconductor Manufacturing Co about raising orders of its H200 data-center processor, citing sources. Chinese tech companies have ordered more than 2 million H200 chips for delivery in 2026, the report said.
The H200 is a graphics processing unit, or GPU, a specialized chip used to train and run artificial intelligence models. Reuters reported the Trump administration has allowed H200 sales to “approved customers” in China with a 25% export fee, but shipments still await clearance from Chinese regulators, with some customers told they may need to bundle domestic chips in their systems. Reuters+1
In a separate development, the U.S. government granted TSMC an annual license to import U.S. chipmaking equipment into its Nanjing facility in China, the company said. The license replaces exemptions under “validated end-user” status — a framework that previously let some firms bring in certain U.S. tools with fewer approvals — which expired on Dec. 31, Reuters reported. Reuters+1
TSMC’s Nanjing plant makes “mature-node” chips — older-generation components such as 16-nanometer products — rather than the company’s most advanced processors, Reuters reported. TSMC said the move would keep operations and deliveries uninterrupted, and Reuters reported similar licenses were issued to Samsung Electronics and SK Hynix. Reuters+1
Beijing’s push to localize the supply chain is also in focus. Reuters reported China is requiring chipmakers to use at least 50% domestically made equipment when adding new capacity, a policy that could squeeze foreign toolmakers in areas where Chinese alternatives are gaining ground.
U.S.-listed chip-equipment shares were among the laggards in the last session, with Lam Research down 1.5% and Applied Materials down 1.1%.
The sector’s late-year dip mirrored a broader risk-off tone, with the Nasdaq Composite ending Dec. 31 down 0.76%, Reuters reported. “It’s perfectly fine in any bull market to have moments of cost,” said Giuseppe Sette, co-founder and president of Reflexivity, pointing to profit-taking when liquidity is low. Reuters
Investors are watching for follow-through on China-facing demand signals without a fresh tightening of export rules, as well as how quickly foundry capacity can be redirected to meet AI-chip orders. The near-term debate for chip stocks remains whether 2026 demand stays strong enough to justify rich valuations after a year of large gains.
Before the next session, U.S. markets reopen on Friday, January 2. Traders are also eyeing CES events next week, including an NVIDIA press conference on January 5 featuring CEO Jensen Huang, and an AMD keynote the same day by CEO Lisa Su.
Macro data could set the tone early in the month, with the New York Fed’s calendar showing the ISM manufacturing report due January 5 at 10:00 a.m. ET, and the U.S. jobs report for December scheduled for January 9 at 8:30 a.m. ET.
On the corporate calendar, TSMC’s fourth-quarter earnings conference is scheduled for January 15 at 1:00 a.m. ET, while Nvidia’s next quarterly results are slated for February 25, according to the company’s events calendar. For technicians, the SOX’s close around 7,083 leaves the round-number 7,000 level as a near-term line to watch.
