ASML, a leading Dutch chip equipment maker, reported strong second-quarter earnings, but its shares dropped sharply due to potential tighter U.S. export restrictions to China. The Biden administration is considering severe trade curbs on companies supplying advanced chip technology to China, impacting ASML and other major chipmakers like TSMC, Samsung, and Tokyo Electron. The geopolitical tensions have led to a significant sell-off in chip stocks globally, with TSMC losing around $61 billion in market value over two days. Despite robust sales driven by AI demand, ASML's performance was overshadowed by these geopolitical risks. The impact of these potential restrictions is widespread, affecting markets in Asia, Europe, and the U.S., and causing a broader tech selloff.