ON Semiconductor Surges 1.3% Amid Trump Tariff Uncertainty, Trading Volume Ranks 244th in Market Activity

On August 7, 2025, ON Semiconductor (ON) closed with a 1.30% gain, trading at a volume of $0.47 billion, ranking 244th in market activity. The stock’s performance aligns with broader industry dynamics driven by U.S. policy shifts in semiconductor manufacturing. President Trump’s announcement of a 100% tariff on imported chips, conditional on domestic production commitments, has intensified sector-wide uncertainty while favoring firms with U.S. manufacturing plans. The policy, which excludes companies building chips domestically, aims to accelerate onshoring but risks inflating costs for downstream products reliant on semiconductors, such as automobiles and electronics. Smaller chipmakers lacking U.S. facilities or financial capacity to scale production face heightened exposure to margin pressures under the new framework.

Industry analysts highlight that the tariff strategy diverges sharply from Biden-era incentives like the CHIPS and Science Act, which offered $50 billion in subsidies to bolster domestic production. Trump’s approach relies on punitive measures to force firms into local manufacturing, contrasting with Biden’s focus on public-private partnerships. While major players like Apple, TSMC, and Nvidia have pledged significant U.S. investments to avoid tariffs, the policy’s long-term efficacy remains unclear. Smaller producers, particularly in Europe and Asia, lack the scale or resources to qualify for exemptions, creating a fragmented competitive landscape. Market reactions suggest optimism for firms securing domestic commitments, but broader inflationary risks loom as chip costs could ripple through consumer goods.

Historical backtesting of a high-volume trading strategy underscores liquidity’s role in short-term performance. Purchasing the top 500 stocks by daily trading volume and holding them for one day generated a 166.71% return from 2022 to the present, outperforming the benchmark by 137.53%. This outperformance reflects concentrated liquidity in volatile markets, where high-volume stocks capture sharp price movements. However, the strategy’s success depends on market structure and macroeconomic conditions, emphasizing the need for risk-adjusted execution. Investors must weigh liquidity dynamics against sector-specific developments, such as Trump’s tariff-driven shifts in semiconductor production, to navigate near-term uncertainties effectively.