Micron Technology (MU) shares plunged 7.18% in pre-market trading on Friday, as the semiconductor sector faced a broad selloff amid escalating trade tensions between the United States and China. The sharp decline comes as part of a larger trend affecting chip stocks, with several major players in the industry experiencing significant drops.

The semiconductor sector's woes deepened after China announced retaliatory measures, imposing a 34% import tariff on all US goods. While semiconductors themselves were exempt from these new tariffs, the broader implications for the industry are severe. Chris Caso, an analyst at Wolfe Research, explained, "The much more significant impact is, rather, the tariffs that will be imposed on finished goods containing semiconductors, most of which are exported from countries for which very high reciprocal tariffs will be applied, and there are no feasible alternatives for supply."

The ripple effect of these trade tensions was felt across the semiconductor landscape. Advanced Micro Devices saw a 4.9% decline, while Qualcomm and Broadcom dropped 4.3% and 4.5% respectively. Even industry giant Nvidia wasn't spared, with its shares sliding 7.8%. The magnitude of the selloff was further illustrated by the nearly 30% drop in SOXL, a leveraged semiconductor ETF. This widespread decline underscores the vulnerability of the semiconductor industry to global trade disputes and highlights the potential long-term challenges facing companies like Micron in navigating an increasingly complex international business environment.