KUALA LUMPUR, June 12 (Bernama) -- Selected blue-chip counters trading at attractive valuations helped Bursa Malaysia close higher on Friday, despite cautious market sentiment driven by developments in West Asia, volatility in crude oil prices and uncertainty over the global interest rate outlook. At 5 pm, the FTSE Bursa Malaysia KLCI (FBM KLCI) rose by 4.10 points or 0.24 per cent to 1,683.63 compared with Thursday's close of 1,679.53. The key index opened 5.34 points stronger at 1,684.87 earlier today and moved between 1,679.72 and 1,685.39 throughout the session. Market breadth was negative, with losers leading gainers 533 to 479, while 561 counters were unchanged, 1,130 untraded and 33 suspended. Turnover fell to 2.79 billion units worth RM2.31 billion from 3.32 billion units worth RM2.88 billion yesterday.
Intel’s reported deal to receive CHIPS Act funding in exchange for equity may mark a major shift in how U.S. semiconductor subsidies are distributed—impacting shareholder value across the industry.
What’s Changing?
The White House is considering converting part of the CHIPS Act funding into equity stakes, starting with Intel. This would mean:
No more “free cash”—funding would come with ownership strings attached
Potential voting rights and governance conditions
Long-term implications for share dilution
Why Investors Should Care
This shift transforms CHIPS grants from non-dilutive aid to low-cost but dilutive capital. Here’s what it means:
Balance Sheet Relief: Improves liquidity for chipmakers
Governance Risk: Brings in government involvement and restrictions
Valuation Impact: Likely to apply a “policy discount” on stocks
Who's Most Exposed?
The risk depends on how CHIPS/DoD awards compare to a company's market cap:
| Company | CHIPS Award % of Market Cap | Sensitivity |
|---|---|---|
| Intel (INTC) | ~10% | 🚨 Highest exposure |
| GlobalFoundries (GFS) | ~9% | High |
| Amkor Technology (AMKR) | ~7% | Moderate |
| Micron (MU) | ~5% | Moderate |
| Texas Instruments (TXN) | ~1% | Low |
| TSMC (TSM) | ~1% | Low |
Intel, with ~10% of its market cap tied to the CHIPS award, faces the greatest risk of dilution and governance influence.
Portfolio Takeaways
Valuation: Expect a policy/governance discount to weigh on high-award names
Positioning: Watch companies with high CHIPS-to-market-cap ratios—they may see the largest swings
Upside: If U.S. ramps fab investments, these same names may benefit from policy-driven demand
What to Monitor Next
Equity Deal Terms: Subscription pricing, lock-ups, voting rights
Scope Expansion: Will more companies be asked to accept equity deals?
Tariff and Trade Link: “Made-in-USA” clauses and chip import tariffs may drive fab expansion
Bottom Line
If CHIPS-to-equity spreads beyond Intel, investors must re-evaluate the cost of capital across the chip sector—not just industrial potential.
Winners: Companies that secure funding without heavy strings
Losers: Those that suffer from dilution and restrictive oversight
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