WASHINGTON (AP) — The Biden administration has reached an agreement to provide $6.1 billion in government support for Micron Technology to produce advanced memory computer chips in New York and Idaho.
Senate Majority Leader Chuck Schumer, D-N.Y., personally courted Micron to build what would ultimately be a set of four chip factories near Syracuse in the town of Clay. He noted in a Wednesday interview that the announcement was a sign to voters about how Democrats were reviving the manufacturing sector.
”It will be the biggest memory chip plant in America,” said Schumer. “For the Syracuse area, this is the best thing that’s happened probably since the Erie Canal.”
The comparison to the 1825 infrastructure project that connected the Great Lakes to the Atlantic Ocean is audacious, but it gets at the possible magnitude of the economic impact as well as the national security stakes in an increasingly digital world.
Including the government support, Micron plans to invest $100 billion in upstate New York over the next two decades. The investment would lead to an estimated 9,000 direct jobs and 40,000 construction jobs. Micron has also announced plans for a $15 billion memory chip plant in its hometown of Boise, Idaho.
The funding comes from the 2022 CHIPS and Science Act, which is set to provide government support for new and expanded facilities being developed by Intel, TSMC, Samsung and Global Foundries, among other chip companies.
The law included $52 billion to support the domestic semiconductor industry, reducing the risk that the chip shortages experienced amid the pandemic could hurt the U.S. economy and national security.
The Democratic administration has set a goal for 20% of the world’s advanced chips to be made in the United States and has restricted the flow of chips into China.
A senior Biden administration official, insisting on anonymity to discuss the deal before its official announcement, confirmed the agreement with Micron.
President Joe Biden discussed in Pittsburgh on Wednesday the importance of computer chips that power everything from weapons to artificial intelligence to household appliances such as refrigerators.
Biden noted that Republican Donald Trump, the former president and his election-year rival, had not been as aggressive in boosting the sector and curbing China's access to chips.
“For all this tough talk on China, it never occurred to my predecessor to do any of that,” Biden told a group of steelworkers.
Trump has told his supporters that China was “afraid” of him because he levied tariffs on the nation with the goal of supporting U.S. factory jobs. Biden has kept the tariffs and on Wednesday suggested plans to expand them on steel and aluminum.
“I took on communist China like no administration in history,” Trump told supporters at a Saturday rally in Pennsylvania.
President Joe Biden waves as he walks across the South Lawn of the White House in Washington, Wednesday, April 17, 2024, after returning from a trip to Pennsylvania. (AP Photo/Susan Walsh)
Wall Street pointed modestly lower early Tuesday as investors digested more corporate earnings reports while keeping their eyes on potentially market-moving reports later this week.
Futures for the Dow Jones Industrial Average and the S&P 500 each ticked back 0.1% before the bell.
McDonald's slipped less than 1% in premarket after the burger chain reported strong U.S. sales, but fell short of Wall Street profit targets. International sales fell as customers across the Middle East and in Muslim-majority markets have been boycotting McDonald’s for months over its perceived support for Israel.
3M jumped 7.6% after its sales and profit came in ahead of Wall Street forecasts. The maker of industrial, safety and consumer goods also issued full-year sales and profit guidance reflecting the spinoff of its Solventum health care business earlier in April.
Europe's largest bank, HSBC, rose 4.2% after it announced that CEO Noel Quinn plans to retire after serving nearly five years in the post. Quinn oversaw the sale of HSBC's Canada and Argentina operations and oversaw the bank’s strongest returns in more than a decade.
Coca-Cola shares barely budged after the beverage giant topped analysts' sales and profit forecasts.
Amazon and Starbucks report their latest financial results after the bell Tuesday.
Markets are also anxiously awaiting the U.S. Federal Reserve's latest policy decision on Wednesday.
Reports of stubbornly high inflation have traders expecting fewer interest rate cuts this year. The U.S. central bank's main interest rate is at its highest level since 2001. Fed Chair Jerome Powell could offer more color in his news conference following the central bank’s decision.
Also on investors’ minds is the jobs report hitting Wall Street on Friday that could show hiring by U.S. employers cooled in April and that growth in workers’ wages held relatively steady.
The hope on Wall Street is that the job market will remain strong enough to help the economy avoid a recession but not so strong that it feeds upward pressure into inflation.
In Europe at midday, France's CAC 40 edged down 0.1% in early trading, while Germany's DAX fell 0.4%. Britain's FTSE 100 added 0.5%.
Japan's benchmark Nikkei 225 jumped 1.2% to finish at 38,405.66, coming back from a national holiday. Sydney's S&P/ASX 200 rose 0.4% to 7,664.10. South Korea's Kospi added 0.2% to 2,692.06. Hong Kong's Hang Seng edged up 0.1% to 17,763.03, while the Shanghai Composite fell 0.3% to 3,104.82.
In Japan, the government reported stronger than expected gains in industrial production with a seasonally adjusted 3.8% rise in March from the previous month.
“Weak manufacturing weighed on growth in the first quarter of the year, but we think that consumption is likely to improve on the back of healthy labor market,” said Min Joo Kang, senior economist at ING.
In energy trading, benchmark U.S. crude added 25 cents to $82.88 a barrel. Brent crude, the international standard, rose 29 cents to $87.49 a barrel.
In currency trading, the U.S. dollar rose to 156.91 Japanese yen from 156.28 yen. The euro cost $1.0721, down a touch from $1.0725.
A person passes the New York Stock Exchange on Tuesday, April 30, 2024 in New York. Global shares are trading mostly higher as investors keep their eyes on potentially market-moving reports expected later this week. (AP Photo/Peter Morgan)
A person looks at an electronic stock board showing Japan's stock prices at a securities firm Tuesday, April 30, 2024, in Tokyo. Asian shares mostly rose Tuesday, as investors kept their eyes on potentially market-moving reports expected later this week. (AP Photo/Eugene Hoshiko)
A window cleaner works along the window of at a securities firm building Tuesday, April 30, 2024, in Tokyo. Japanese characters read as "securities." (AP Photo/Eugene Hoshiko)
A person walks in front of an electronic stock board showing Japan Yen/U.S. dollar exchange rate at a securities firm Tuesday, April 30, 2024, in Tokyo. Asian shares mostly rose Tuesday, as investors kept their eyes on potentially market-moving reports expected later this week. (AP Photo/Eugene Hoshiko)
A person stands in front of an electronic stock board showing Japan's Nikkei 225 index at a securities firm Tuesday, April 30, 2024, in Tokyo. Asian shares mostly rose Tuesday, as investors kept their eyes on potentially market-moving reports expected later this week. (AP Photo/Eugene Hoshiko)
A person walks in front of an electronic stock board showing Japan's Nikkei 225 index at a securities firm Tuesday, April 30, 2024, in Tokyo. Asian shares mostly rose Tuesday, as investors kept their eyes on potentially market-moving reports expected later this week. (AP Photo/Eugene Hoshiko)
People pass by an electronic stock board showing Japan's Nikkei 225 index, left, and U.dollar/Japanese yen conversion rate at a securities firm Tuesday, April 30, 2024, in Tokyo. Asian shares mostly rose Tuesday, as investors kept their eyes on potentially market-moving reports expected later this week.(AP Photo/Eugene Hoshiko)
People stand in front of an electronic stock board showing Japan's Nikkei 225 index at a securities firm Tuesday, April 30, 2024, in Tokyo. Asian shares mostly rose Tuesday, as investors kept their eyes on potentially market-moving reports expected later this week.(AP Photo/Eugene Hoshiko)
