A U.S.-China tech war will hurt the rally in tech stocks:
- China announced export controls on gallium and germanium, two minerals that are essential for the production of semiconductors.
- President Joe Biden is also planning to restrict Chinese companies access to U.S. cloud-computing services that use AI chips.
The U.S. and China need to find a way to de-escalate this tech war. If not, It will only lead to more restrictions on trade and have a significant impact on the global chip sector, which is already facing shortages.
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