LRCX - Lam Research KLA shares drop after SMIC's U.S. ban

Over the weekend, media reports said the U.S. Commerce Department will force domestic chip companies to apply for a license to supply to SMIC (SMICY), China's top chipmaker.KeyBanc says the news suggests "additional risk to semiconductor equipment companies and materials providers if trade war policies continue to escalate" but says the long-term tailwinds are still positive for semi equipment.Citi thinks the equipment stocks "are already pricing in the negative impact from a SMIC equipment ban."KLA (KLAC) shares are are down 1.8% pre-market and Lam Research (LRCX) is down 1.2%.Reports of a potential SMIC ban first started circulating earlier this month. Here's a look at how the chip equipment stocks have performed in the past month, compared to the tech sector (XLK) and S&P 500:

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Lam Research, KLA shares drop after SMIC's U.S. ban