US Blocks Chip Shipments to China's Hua Hong

0:00It's April 29th, I'm Corey with The Story, and this is US News Today National News powered by AI. The US Department of Commerce just hit paws on key chip-making tool shipments to China's Kwa Hong, the country's number two chip maker. They sent letters to big players like Lamb Research, Applied Materials, and KLA. Blocking gear headed to two specific Kwa Hong plants in Shanghai, officials worry these spots could crank out China's most advanced chips, like 7nm tech for AI. This ramps up the long-running US push to curb China's chip ambitions. Back in March, reports showed Kwa Hong hitting milestones in advanced manufacturing, closing in on self-reliance. Their unit, Huali Microelectronics, was gearing up for 7nm production, putting them right behind leader SMIC. Markets felt distinct quick. Lamb shares dropped 3.1%, KLA, 4.7, Applied Materials, 5.8, and Kwa Hong's. Doc fell 4.29% in Shanghai.

1:01One expert called it a smart first move by the administration, but stressed it needs to cover all US suppliers, even overseas branches, to really bite. These moves echo past restrictions, like those on Nvidia and others, using fast-track letters to skip red tape. Huawei's in the mix too, shifting some AI chip work to Huali Hong, and backing their 7nm push, aiming for thousands of wafers monthly by late. 2020-26. Tensions could spike before any big US China summits, with billions in potential loss sales for American firms. China might pivot to other suppliers, but for now, this slows their high tech sprint just enough to keep the edge in play.