Following stellar performance in 2023, U.S. semiconductor stocks have taken a hit at the start of 2024, with notable declines in Tuesday morning trading in New York. This downturn comes in the wake of the White House's directive to a prominent European chipmaker, signaling escalating U.S.-China trade tensions.

What Happened: NVIDIA Corp. (NVDA  ) witnessed a decline of 4%, while Advanced Micro Devices Inc. (AMD  ) experienced a sharper drop of over 5%. Overall, the largest U.S.-traded 25 semiconductor companies have seen nearly $100 billion erased in market value in just the first trading hours of Tuesday.

As Bloomberg reported, Dutch chipmaker supplier ASML Holdings N.V (ASML  ) complied with U.S. President Joe Biden's request to halt certain shipments to China weeks ahead of a new export ban's enforcement.

ASML, Europe's tech giant, confirmed the Dutch government partially revoked licenses for shipping specific lithography systems to China, impacting a few customers. Despite these developments, ASML believes the recent blockade won't significantly affect its 2023 financial outlook. Shares of ASML Holding N.V. dropped by 4.3%, marking their weakest daily performance since late July.

Why It Matters: In 2023, semiconductor stocks, as tracked by the iShares Semiconductor ETF (SOXX  ), closed with a 66% gain, the best since 2009's 74% annual increase. Yet the onset of 2024 presents challenges as the market begins to weigh the risks of a potential new tech trade war and its negative influence on the sector's growth.

US Chipmakers Wipe Out $100 Billion On 2024's First Trading Day

NameMarket Cap (in billions)1-Day % Change1-Day Market Cap Loss (in billions)

• NVIDIA Corporation$1,179.72-3.55%-$41.93
• Advanced Micro Devices, Inc.$225.22-5.43%-$12.22
• Broadcom Inc. (AVGO  ) $513.07-1.82%-$9.32
• Intel Corporation$203.19-4.09%-$8.31
• Applied Materials, Inc. (AMAT  ) $129.77-3.65%-$4.74
• QUALCOMM Incorporated (QCOM  ) $156.73-2.63%-$4.13
• Lam Research Corporation (LRCX  ) $99.26-3.85%-$3.82
• Micron Technology, Inc. (MU  ) $91.85-2.51%-$2.30
• KLA Corporation (KLAC  ) $76.92-2.94%-$2.26
• Analog Devices, Inc. (ADI  ) $96.74-1.83%-$1.77
• NXP Semiconductors N.V. (NXPI  ) $57.54-2.81%-$1.62
• Texas Instruments Incorporated (TXN  ) $153.21-1.03%-$1.58
• Marvell Technology, Inc. (MRVL  ) $50.75-2.67%-$1.35
• Monolithic Power Systems, Inc. (MPWR  ) $29.17-3.49%-$1.02
• Microchip Technology Incorporated (MCHP  ) $47.86-1.91%-$0.91
• Entegris, Inc. (ENTG  ) $17.19-4.43%-$0.76
• Teradyne, Inc. (TER  ) $16.16-2.58%-$0.42
• ON Semiconductor Corporation (ON  ) $35.60-1.04%-$0.37
• Skyworks Solutions, Inc. (SWKS  ) $17.64-1.88%-$0.33
• Qorvo, Inc. (QRVO  ) $10.67-2.70%-$0.29
• Rambus Inc. (RMBS  ) $7.08-3.55%-$0.25
• MKS Instruments, Inc. (MKSI  ) $6.72-2.31%-$0.16
• Lattice Semiconductor Corporation (LSCC  ) $9.37-1.64%-$0.15
• Axcelis Technologies, Inc. (ACLS  ) $4.11-3.24%-$0.13
• Wolfspeed, Inc. (WOLF  ) $5.490.74%$0.04