Dear fans of semiconductor stocks, mark your calendars for November 29

One of President Joe Biden’s first stops after Thanksgiving 2022 will be in Bay City, Michigan. On September 1, Governor Gretchen Whitmer celebrated the opening of the city’s new semiconductor wafer fabrication facility. Korean company ownership Sask. siltron, this plant is the product of a $300 million investment by the Biden administration. Michigan is not the only state to receive federal funds for this purpose. However, its new plant has the potential to help ease supply chain constraints that have plagued local automakers all year.

On Nov. 29, Biden will discuss his administration’s policies that have helped boost chip production in states like Michigan. When it does, it will boost semiconductor stocks across the country. Which companies should investors watch closely as Biden prepares for the Bay City address? Let’s take a closer look.

Semiconductor stocks: what to watch

It’s been a good day so far and a great week overall for semiconductor stocks. Many companies trended higher all week, including Nvidia (NASDAQ:NVDA), Advanced micro-systems (NASDAQ:AMD) and Micron Technology (NASDAQ:MU). Despite a grim warning from Micron about the market outlook last week, all three companies have posted impressive growth recently, with gains of nearly 30% for the month.

InvestorPlace Writer William White recently reported that semiconductor stocks face a troubling economic landscape amid weakening PC demand. However, that doesn’t mean chipmakers are destined for a tough year ahead. Semiconductors are also a critical part of electric vehicle (EV) production, an area where demand has skyrocketed in 2022 and is expected to continue to rise. For a factory built in Michigan, this is especially convenient, as the state is known for automotive manufacturing. Legacy automakers Ford (NYSE:F) and General Engines (NYSE:GM) are both based in Michigan and have a strong focus on increasing electric vehicle production. A partnership with a local chipmaker would be a great catalyst for either company, as well as many of their peers.

Now, Biden’s Bay City factory address promises to focus on semiconductor stocks, pushing them up in the process. The president has prioritized increasing chip production throughout his tenure. Most notably, he signed the Helpful Semiconductor Production Incentives for America (CHIPS) Act. Michigan has always been at the center of this movement. When Governor Whitmer signed the bill’s executive directive in August 2022, Biden joined her virtually for the event.

The essential

The Nov. 29 address is the next step toward increasing chip production. This is an opportunity not only to tout the economic benefits of helping US-based chipmakers, but to highlight the potential of the industry as a whole. As The Detroit News reports:

“The White House announcement said Biden “will discuss the progress we’ve made over the past two years, including creating well-paying manufacturing jobs and building a bottom-up and middle economy. “

Following the passage of the CHIPS Act, experts speculated that it would help boost semiconductor stocks over the long term. President Biden’s speech next week will serve as a reminder of why this is so and why chipmakers will play a vital role in American manufacturing for years to come.

At the date of publication, Samuel O’Brient held (neither directly nor indirectly) any position in the securities mentioned in this article. The opinions expressed in this article are those of the author, subject to the Publication guidelines.

Samuel O’Brient has been covering financial markets and analyzing economic policy for over three years. His areas of expertise are in electric vehicle (EV) inventory, green energy and NFT. O’Brient enjoys helping everyone understand the intricacies of economics. He is ranked in the top 15% of stock pickers on TipRanks.


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