The bill, known as the Chips for America Act, is a pared-down version of a broader set of competition measures and would authorize $52 billion in grants and loans for chip manufacturers, as well as a new, four-year 25% investment tax credit for chip making.
Senate Majority Leader Chuck Schumer has pressed for a vote today with final passage as early as next week.
The vote today has been held up by last-minute negotiations over extending for one year a R&D tax break that expired in 2021. The R&D tax break would benefit a wide range of companies with outsized R&D expenses including Alphabet (GOOG), Pfizer (PFE), and Ford (F).
Explaining why chip companies in general climbed today on the prospective subsidy bill gets a bit tenuous because the subsidies would go to chip manufacturers, such as Intel (INTC), and not chip designers such as Nvidia (NVDA).
However, both chip makers such as Intel and chip designers such as Nvidia climbed today. Intel shares closed the day up 3.90%. Nvidia (NVDA) ended the day up 5.53%. Advanced Micro Devices (AMD) was ahead 5.46%.
The NASDAQ 100 gained 3.13% on the day.