The Dutch government has partially revoked semiconductor equipment maker ASML’s export license to China for two of its systems used in manufacturing advanced chips. “A license for the shipment of NXT:2050i and NXT:2100i lithography systems in 2023 has recently been partially revoked by the Dutch government, impacting a small number of customers in China,” said ASML in a statement. ASML has also not shipped the equipment to China so far. NXT:2050i and NXT:2100i are deep ultraviolet lithography machines used in the volume production of the most advanced logic and memory chips, and ASML has stated that it does not expect the move to have a material impact on its financial outlook for 2023.
In other economic news, Singapore’s GDP expanded 2.8% in the final quarter of 2023, a sharp increase from the 1% expansion recorded in the third quarter and the fastest rate of growth since the third quarter of 2022. Meanwhile, Australia’s factory activity in December contracted at its fastest pace since May 2020, according to private surveys from Judo Bank. The country’s manufacturing purchasing managers’ index fell to 47.6 in December, down from 47.7 in November, marking its 10th straight month of contraction.
A private survey showed manufacturing activity in China expanded in December, at odds with a similar survey conducted by the country’s statistics bureau that reported a contraction. The Caixin manufacturing purchasing managers’ index came in at 50.8 in December, according to a release Tuesday, following a 50.7 reading for November. China’s official PMI fell to 49.0 in December from 49.4 the previous month, the country’s National Bureau of Statistics said in a Sunday release. A PMI reading above 50 indicates expansion in activity, while a reading below that level points to a contraction.
Investors are on record watch as the S&P 500, with its Friday close of 4,769.83, is now less than 1% away from a new high. A close above 4796.56, the record the equity benchmark reached in January 2022, would constitute a new all-time high. The S&P 500’s current intraday record is 4818.62, also from January 2022. Additionally, despite the banner year in 2023, investors should not necessarily expect an even bigger year in 2024. According to Carson Group’s chief market strategist, history suggests that after a year with a gain of more than 20%, the equity benchmark has seen an average return of 10% the following year, with only one instance in history where stocks gained more the next year.