Nvidia, Advanced Micro Devices lead semis lower as Senate votes to advance CHIPS Act

jiefeng jiang

Nvidia (NASDAQ:NVDA), Advanced Micro Devices (NASDAQ:AMD) and Marvell Technology (NASDAQ:MRVL) were among the largest decliners among semiconductor stocks on Tuesday, even as the U.S. Senate advanced a bill to boost semiconductor manufacturing in the country amid worries about competition with China.

The legislation, which the Senate approved 64-32, would give the industry $52B in subsidies for domestic production and a previously reported investment tax credit for chip plants that could be worth an estimated $24B over the next decade, Reuters reported.

The bill also authorizes $200B to boost scientific research over the next 10 years.

On Tuesday, Senate Majority Leader Chuck Schumer said the legislative body would finish the funding bill by the end of the week. The House could vote on the bill as soon as this week, as Speaker Nancy Pelosi has previously expressed support.

President Biden tweeted support for the CHIPS Act, writing that it will help America compete with China.

Nvidia (NVDA) fell 2.5%, while AMD (AMD), Marvell (MRVL) and Qualcomm (QCOM) declined nearly 2% in mid-day trading.

Other chip stocks, such as Analog Devices (ADI), Texas Instruments (TXN) and Broadcom (AVGO) were also lower.

Both Micron (MU) and Intel (INTC) bucked the trend, each gaining slightly more than 0.5%, while NXP Semiconductors (NXPI) also rose, on back of strong second-quarter results and guidance.

Last week, investment firm Benchmark started coverage on Marvell Technology (MRVL), calling the semiconductor company's technology "essential."