![Pinterest](https://pinterest.com/pin/create/button/?url=https://xperttimes.com/asias-tech-sector-eyes-restoration-with-semiconductor-surge-jpmorgan-highlights/&media=https://xperttimes.com/wp-content/uploads/2024/03/Asias-Tech-Sector-Eyes-Recovery-with-Semiconductor-Surge-JPMorgan-Highlights.jpg&description=SINGAPORE – Asia-Pacific's tech sector has been growing on the back of the semiconductor boom even as other industries struggle amid global macro uncertainty, according to investment bank JPMorgan.Technology's Resilience Amid Economic ChallengesTech has been recovering, that's why Asia has done reasonably well in the second half of last year. China industry benefited, North Asia obviously benefited more from it," Bruce Kasman, chief economist at JPMorgan said in a media briefing on Tuesday. The tech sector, which thrived during the Covid-19 pandemic as companies accelerated their digitalization efforts, underwent a slowdown in 2022 and 2023 as high inflation and interest rates softened consumer spending, hit product demand and led to layoffs. Global tech spending weakened in 2023 while layoffs rose, said Deloitte in a report on tech industry's 2024 outlook.The Semiconductor Boom"But there are now glimmers of hope that a tech comeback may be imminent: Economists have lowered their assessments of recession risk, and analysts are optimistic that the tech sector could return to modest growth in 2024," Deloitte said. The recovery in tech is significant as other industries are still struggling. "Even though we have seen recovery in tech, we are not seeing a broader based recovery in the non-tech sectors," said Ong Sin Beng, head of EM Asia economics research at JPMorgan, on Tuesday. The artificial intelligence boom continues to boost chipmakers and is driving tech growth. U.S. chip design firm Nvidia saw a 265% jump in fourth-quarter revenue, thanks to skyrocketing demand for its graphics processing units, thousands of which are used to run and train OpenAI's ChatGPT.Regional Beneficiaries of the Tech RecoveryBut the recovery is not uniform across the tech sector, JPMorgan said, singling out the semiconductor industry as the bright spot amid the AI boom. "It is primarily in the semiconductor, dynamic random access memory sector. So we are seeing, for example, Korean production doing quite well. Taiwan is because of the logic chips we are seeing that do relatively well. So those are the two key beneficiaries in North Asia," Ong said. Taiwan's TSMC is the primary contract chip manufacturer for Nvidia and has benefited from Nvidia's performance and potential. South Korean DRAM chip makers such as Samsung Electronics and SK Hynix have also benefited from the AI boom as large language models like ChatGPT require high-performance memory chips to generate human-like responses. "Our equity analysts who oversee the sector remain quite positive simply because it's built out of broader digitization, data centers, AI, etc," Ong said. He also said Singapore was "certainly seeing that lift" from the semiconductor boom. The country manufactures 20% of global chip equipment, according to data shared at the Singapore Semiconductor Industry Association Semiconductor Business Connect 2022. For More Interesting News Follow Us on Instagram){kind=link}
SINGAPORE – Asia-Pacific’s tech sector has been rising on the again of the semiconductor growth at the same time as different industries battle amid international macro uncertainty, in accordance with funding financial institution JPMorgan.
Know-how’s Resilience Amid Financial Challenges
Tech has been recovering, that is why Asia has achieved moderately nicely within the second half of final yr. China trade benefited, North Asia clearly benefited extra from it,” Bruce Kasman, chief economist at JPMorgan stated in a media briefing on Tuesday. The tech sector, which thrived in the course of the Covid-19 pandemic as firms accelerated their digitalization efforts, underwent a slowdown in 2022 and 2023 as excessive inflation and rates of interest softened client spending, hit product demand and led to layoffs. World tech spending weakened in 2023 whereas layoffs rose, stated Deloitte in a report on tech trade’s 2024 outlook.
The Semiconductor Growth
“However there at the moment are glimmers of hope {that a} tech comeback could also be imminent: Economists have lowered their assessments of recession danger, and analysts are optimistic that the tech sector might return to modest development in 2024,” Deloitte stated. The restoration in tech is important as different industries are nonetheless struggling. “Although we’ve seen restoration in tech, we’re not seeing a broader primarily based restoration within the non-tech sectors,” stated Ong Sin Beng, head of EM Asia economics analysis at JPMorgan, on Tuesday. The bogus intelligence growth continues to spice up chipmakers and is driving tech development. U.S. chip design agency Nvidia noticed a 265% soar in fourth-quarter income, because of skyrocketing demand for its graphics processing models, hundreds of that are used to run and practice OpenAI’s ChatGPT.
Regional Beneficiaries of the Tech Restoration
However the restoration isn’t uniform throughout the tech sector, JPMorgan stated, singling out the semiconductor trade as the intense spot amid the AI growth. “It’s primarily within the semiconductor, dynamic random entry reminiscence sector. So we’re seeing, for instance, Korean manufacturing doing fairly nicely. Taiwan is due to the logic chips we’re seeing that do comparatively nicely. So these are the 2 key beneficiaries in North Asia,” Ong stated. Taiwan’s TSMC is the first contract chip producer for Nvidia and has benefited from Nvidia’s efficiency and potential. South Korean DRAM chip makers reminiscent of Samsung Electronics and SK Hynix have additionally benefited from the AI growth as giant language fashions like ChatGPT require high-performance reminiscence chips to generate human-like responses. “Our fairness analysts who oversee the sector stay fairly optimistic just because it is constructed out of broader digitization, knowledge facilities, AI, and many others,” Ong stated. He additionally stated Singapore was “definitely seeing that elevate” from the semiconductor growth. The nation manufactures 20% of worldwide chip tools, in accordance with knowledge shared on the Singapore Semiconductor Trade Affiliation Semiconductor Enterprise Join 2022.
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