KUALA LUMPUR, Sept 8 (Bernama) -- Bursa Malaysia closed almost flat on Tuesday as buying interest rotated away from index heavyweights towards smaller-cap construction stocks, with sentiment affected by geopolitical uncertainty, said an analyst. At 5 pm, the FTSE Bursa Malaysia KLCI (FBM KLCI) eased 0.39 of a point to 1,714.40 from Monday’s close of 1,714.79. The benchmark index opened 1.65 points lower at 1,713.14 and moved between 1,710.44 and 1,714.50 throughout the trading session. The broader market was almost evenly balanced, with decliners leading gainers 548 to 546, while 598 counters were unchanged, 1,107 were untraded and 25 were suspended. Turnover expanded to 4.13 billion units valued at RM3.14 billion from 3.60 billion units valued at RM2.45 billion on Monday.
Key Takeaway: Despite export bans, China’s semiconductor industry continues to secure vital chipmaking tools from US and allied firms, exposing cracks in the global tech blockade.
Policy Gaps Undermine US Efforts
A bipartisan US congressional report has revealed that Chinese chip manufacturers purchased US$38 billion worth of semiconductor equipment from American and allied suppliers in 2024 — a 66% jump from 2022.
The surge highlights loopholes in export controls introduced by the US, Japan, and the Netherlands. These inconsistencies allowed non-US companies to sell equipment to Chinese firms that American suppliers were barred from serving.
Who’s Selling and Who’s Buying
According to the report, sales to China represented 39% of total revenue for top toolmakers:
Applied Materials
Lam Research
KLA Corp
ASML
Tokyo Electron
Chinese firms SwaySure Technology, Shenzhen Pengxinxu, and SiEn (Qingdao) were identified as key buyers and potential national security risks. The trio had previously been flagged for alleged ties to Huawei’s covert supply chain network.
National Security and Tech Rivalry
The US has long aimed to curb China’s ability to produce advanced semiconductors — critical for AI, defense, and high-performance computing.
However, the latest findings show that China continues to stockpile equipment to advance its domestic chip ecosystem.
“China is attempting to rewrite the entire supply chain,” said Craig Singleton from the Foundation for Defense of Democracies.
Industry Voices: Coordination Still Lacking
Mark Dougherty, president of Tokyo Electron US, acknowledged that sales to China have started to decline in 2025, partly due to newer export rules. Still, he emphasized the need for better coordination between allied governments.
The committee has recommended broader, sector-wide restrictions on equipment and even components that could help China build its own chipmaking tools.
Investment Implications
The report underscores an ongoing policy tug-of-war between national security and corporate revenue. While export bans pressure toolmakers’ growth, China remains too large a market to ignore.
For investors:
Expect near-term headwinds for semiconductor equipment firms as restrictions tighten.
Longer term, diversification into non-China markets could cushion the impact.
Watch for policy alignment among the US, Japan, and the Netherlands — a key variable for the sector’s stability.
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