A report emerged that China has produced a key chipmaking tool, entering a market that has long been dominated by ASML. However, analysts told CNBC that ASML is unlikely to be heavily impacted as many questions remain about China's technology:
An unnamed Chinese company has begun manufacturing an immersion deep ultraviolet lithography (DUV) machine, expected to be delivered this year to China's biggest chip manufacturers, including Semiconductor Manufacturing International Corp. and Changxin Memory Technologies (CXMT):
Why did it spark a sell-off?
Investors are concerned that if China continues to build out its homegrown semiconductor technology, it could cut off some of the biggest U.S., European, and other Asian firms from the huge market:
Scale and performance questions for China's DUV machines
The performance of China's DUV machines is currently unclear, and manufacturers focus on achieving yield:
Will this hurt ASML?
ASML's shares tanked as much as 8% on Monday after the report raised concerns about its market share in China:
Can China advance even further?
China has also reported completing a working prototype of an EUV machine, but analysts say that progress in DUV does not necessarily mean that China will crack EUV:
