Chipmaker Stocks Higher on Surging Demand Outlook By Investing.com

By Dhirendra Tripathi

Investing.com – Shares of chip-making companies were making smart gains in Thursday’s trading on the back of their aggressive expansion plans fueled by a strong demand for their use in mobiles, tablets, computers and cars.

Micron Technology (NASDAQ:) shares were the biggest gainers in the session so far on reports that the company was weighing a bid to buy Kioxia. They rose 4.5% after WSJ said Micron could value the Japanese rival at $30 billion.

TSM shares rose by over 2%, boosted by the company’s plans to spend $100 billion over the next three years to expand its chip fabrication capacity. TSM is the world’s leading manufacturer of advanced semiconductors purchased by Apple (NASDAQ:), Qualcomm (NASDAQ:) and NVIDIA (NASDAQ:).

Shares of NXP Semiconductors (NASDAQ:) gained almost 2% as demand for its chips continues to surge amidst a boom for electric and autonomous cars.

Intel  (NASDAQ:) was higher by 1%. The company recently unveiled plans to invest $20 billion to build two new chip plants in Arizona. Qualcomm (NASDAQ:) shares also rose 1.5%.

The advent of 5G services and the general advance of automation has led to record high demand for devices using semiconductors. The pandemic has also spurred a short-term surge in demand for some electronic devices, while the cold snap in the southern U.S. in February has crimped supply by taking major production centers offline.

The disruption will impact the global chip contract manufacturing industry, research provider TrendForce has said.

Chips come in various sizes and shapes including 5G radio frequency chips, display and image sensor chips, power management integrated circuits and chips that control electrical parts.