KUALA LUMPUR, Dec 5 (Bernama) -- Bursa Malaysia closed lower on Friday amid mixed regional market performance as investors turned cautious over a possible rate hike by the Bank of Japan (BOJ) and upcoming US economic data that may influence the Federal Reserve’s (Fed) interest rate decision next week. At 5 pm, the FTSE Bursa Malaysia KLCI (FBM KLCI) pared most earlier losses to settle 4.55 points easier, or 0.28 per cent, to 1,616.52 from Thursday’s close of 1,621.07. The benchmark index, which opened 0.37 of-a-point lower at 1,620.70, moved between 1,609.67 and 1,621.25 throughout the day. The broader market was negative, with decliners outpacing advancers 604 to 439. A total of 550 counters were unchanged, 1,151 untraded, and 18 suspended. Turnover declined to 3.17 billion units worth RM2.24 billion from 4.48 billion units worth RM2.75 billion yesterday. Rakuten Trade Sdn Bhd vice-presiden...
With Washington hinting at punitive semiconductor tariffs as high as 200%-300%, uncertainty is clouding the global chip supply chain. A week after Trump’s announcement, the final scope and exemption details remain unclear, leaving investors to weigh potential winners and losers.
Policy Contrast: Subsidies vs. Tariffs
Biden era: Focused on subsidies and incentives via the CHIPS Act to encourage “Made in America.”
Trump era: Favors penalizing offshore manufacturing through tariffs to force reshoring.
While both approaches share the same end goal — strengthening US semiconductor competitiveness — the cost and execution dynamics diverge sharply.
Key Mechanics: Who Pays?
Origin rules matter: For integrated circuits, the front-end wafer fabrication sets country of origin. Back-end packaging (CoWoS, 2.5D, 3D) rarely shifts this classification.
US-made wafers shipped abroad: If Section 9802 treatment applies, tariffs may apply only on the foreign value add. If not, the full import value could be taxed.
Exemptions: Unclear whether carve-outs will be product-based (US-made output exempt) or company-based (favors US firms regardless of geography).
Immediate Risks
US companies with offshore fabs: Intel (Ireland, Israel) and Micron (Japan) face exposure unless company-wide exemptions emerge.
Non-US fabs with US revenue mix: Tower Semiconductor (TSEM), UMC, STMicroelectronics (STM), NXP (NXPI), and Infineon (IFNNY) remain vulnerable where no US fab presence exists.
Relative Beneficiaries
Foundries with US build-outs:
TSMC Arizona: Recently crossed a profitability milestone via its US subsidiary.
GlobalFoundries (GFS): Strong positioning as a US-based pure-play foundry.
Tower Semiconductor: Runs two US fabs and expanding via Intel’s Arizona site.
Texas Instruments (TXN): Sherman fab build-out adds domestic resilience.
OSAT/Packaging with US presence: Amkor (AMKR, Arizona), SK Hynix (Indiana HBM packaging).
Longer-Term Effects
Bloc-to-bloc decoupling: “US for US, China for China” supply chains could harden, increasing duplication and costs.
Execution challenge: Accelerated reshoring raises capex intensity for both US and foreign players.
Pricing power: Higher effective BOM costs risk short-term order pull-ins but mid-term demand friction if passed to end-users.
Watchpoints
Final tariff text – scope, rates, exemption definitions, and 9802 treatment.
“Made in America” scope – will both front-end and advanced packaging need to be onshore?
Customer order shifts – NVIDIA (NVDA), Apple (AAPL), AMD (AMD), and Qualcomm (QCOM) could reshuffle supply chains rapidly once rules are confirmed.
Investment Take
Until tariff language is finalized, risk remains origin-driven: fabs with US production capacity are clear winners, while those dependent on Asia or Europe face higher uncertainty. For investors, GlobalFoundries, TSMC Arizona, Tower, and TI screen best positioned, while UMC, STM, NXPI, and Infineon carry relative downside risk.
Bottom Line: In a tariff-driven regime, speed of exempt-capacity build-out — not scale of global headlines — will separate winners from losers.
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