The US order caused TSMC's stock price to drop more than 3% as it 'cut off the supply of chips below 7 nanometers to China', and the Taiwan stock market fell more than 500 points, breaking through the monthly average line.

The US has upgraded its control over Chinese chips, and the US Department of Commerce has reportedly requested TSMC to stop supplying AI chips to China, causing concerns in the market that TSMC's revenue will be affected. TSMC big dumped by 3.23% today, leading to a plummet in the Taiex, with the weighted index falling below 23,000 points and a single-day big dump of nearly 500 points, breaking through the monthly line. (Background: TSMC complains that Taiwan has the most expensive electricity in the world! Minister of Economic Affairs responds: efforts to reduce prices and buy green energy from the Philippines). TSMC was previously accused of violating US sanctions by assisting Huawei in bypassing US controls and purchasing chips from TSMC. TSMC promptly reported the matter to the US Department of Commerce and announced a halt in supplying chips to the company involved. However, the Huawei incident continues to simmer, with recent reports from Reuters stating that the US Department of Commerce has tightened chip control measures, requiring TSMC to stop supplying specific 7nm or more advanced chips for AI accelerators and GPUs to Chinese customers from this week, causing concerns that TSMC's revenue will be significantly impacted. TSMC's stock price fell by 3.23% or 30 points to 1050 points on Tuesday, breaking through the monthly line, and the Taiex was affected as well, with all listed stocks ending in the red and the weighted index dropping by 2.33% or 547.87 points to 22981.77 points, breaking through the 23222 points of the monthly line. Source: Google. According to statistics from the three major institutional investors, foreign and mainland investors (excluding foreign proprietary traders) sold off NT$47.636 billion, trust funds bought NT$6.303 billion, and proprietary traders (total) sold off NT$20.493 billion, including proprietary traders (own account) selling off NT$4.747 billion and proprietary traders (hedging) selling off NT$15.745 billion. Two major foreign institutions estimate limited impact on TSMC. Fubon Technology released a report analyzing that the new chip ban will affect the future development of China's AI industry and impact TSMC's revenue by about 5-8%. However, Morgan Stanley and Citigroup Securities released reports stating that TSMC's impact is limited, and both foreign institutions maintain positive ratings such as 'outperform the market' and 'buy,' with target prices of NT$1,330 and NT$1,540, respectively. Morgan Stanley's semiconductor industry analyst, Chien Chia-hung, stated that TSMC's revenue from Chinese cloud AI semiconductors is very limited, accounting for only about 1%. TSMC's main Chinese customers include chip developer Alchip Technology, Alibaba's semiconductor chip department 'Pingtouge,' and small enterprises like Meta-X. Chien believes that China's cloud service providers can still import products from other US chip suppliers through other channels, such as Nvidia's H20 and Intel's Gaudi 3, so the potential impact on TSMC should be extremely limited. Therefore, he maintains the 'outperform the market' rating for TSMC and the unchanged target price of NT$1,330. Citigroup's semiconductor industry analyst, Chen Jiayi, pointed out that overall, Chinese customers account for only about 11% of TSMC's revenue contribution, mostly for non-AI applications such as smartphone and cryptocurrency chips. With further control of high-performance computing (HPC) chips exported to China, some orders may shift to controlled chips, such as Nvidia's H20, which will still bring positive benefits to TSMC. TSMC's October revenue increased by 29.2% year-on-year and 24.8% month-on-month, outperforming market expectations. Looking ahead, Chen Jiayi remains optimistic about TSMC's long-term prospects and expects stronger growth momentum next year, so she reaffirms the 'buy' rating for TSMC with a target price of NT$1,540. Related reports: Self-developed chips become a highlight! OpenAI is rumored to collaborate with Broadcom to create AI chips, with TSMC's capacity reserved for 2026. Involved in the Huawei chip ban: Bitmain may be cut off by TSMC! L9 mining machines cannot be produced and delivered. TSMC's chips are urgently cut off by a mysterious client 'flowing into Huawei': already reported to the US Department of Commerce, US lawmakers demand an explanation. (US orders TSMC to 'cut off 7nm or less chips to China,' stock price scares fall by more than 3%, and Taiex falls by over 500 points, breaking through the monthly line) This article was first published on BlockTempo, the most influential blockchain news media.