Chip equipment stocks fall on report of China shipment restrictions

Investing.com -- Shares of U.S. chip equipment makers Lam Research, Applied Materials and KLA declined Tuesday following a report that the U.S. Department of Commerce ordered companies to stop certain tool shipments to China's second-largest chipmaker Hua Hong.

The department reportedly sent letters last week to at least several companies informing them of the new restrictions on tools and other materials destined for Hua Hong facilities that U.S. officials believe will make China's most sophisticated chips.

Lam Research, Applied Materials and KLA, each of which has significant business supplying China, were among the firms in question, the report said.

U.S. chip equipment companies and other suppliers could lose billions of dollars in sales, the report says, particularly if they were supplying a chipmaking plant that is under construction or one that is retooling to begin making more advanced chips.

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