What's Going On With Broadcom Stock Thursday?

Broadcom Inc. (NASDAQ:AVGO) stock fell more than 1% Thursday as investors weighed fresh scrutiny of its data center switch business in China against broader weakness in technology stocks.

The Nasdaq slipped 0.06%, while the Technology sector fell 0.36%, adding to pressure on Broadcom shares.

China Targets Broadcom Dependence In State-Owned Data Centers

Separately, Broadcom faces fresh scrutiny in China as authorities review the use of its networking switches in state-backed data centers, according to the Financial Times.

China’s State-owned Assets Supervision and Administration Commission has surveyed state-controlled data centers about their reliance on Broadcom hardware. The review is part of Beijing’s push to increase the use of domestic chips and AI infrastructure.

The survey found Broadcom switches could account for as much as 90% of deployments among state-owned companies, the report said. That could lead to informal guidance encouraging greater use of Chinese suppliers such as Huawei.

The report added that the review does not appear to cover private data centers operated by companies such as ByteDance and Alibaba Group Holding Limited (NYSE:BABA). Existing Broadcom equipment is also not expected to be removed.

Technical Picture Remains Cautious

Broadcom remains below several important moving averages.

The stock is trading about 2.5% below its 20-day simple moving average of $358.95. It is also 7.2% below its 50-day SMA of $377.05 and 5.1% below its 200-day SMA of $368.59.

That setup could make rebounds vulnerable near those levels.

The 20-day SMA remains below the 50-day SMA, signaling weaker short-term momentum. However, the 50-day average is still above the 200-day average following an April golden cross.

Momentum has improved slightly. The MACD is above its signal line, while the histogram remains positive. That suggests selling pressure may be easing.

Broadcom faces resistance near $376.50. Support sits around $335.50.

Analysts Remain Bullish

Broadcom carries a Buy consensus rating with an average price forecast of $518.96.

Piper Sandler initiated coverage Sept. 10 with an Overweight rating and a $460 price forecast. Citigroup maintained a Buy rating Sept. 4 and raised its price forecast to $515. DA Davidson maintained a Neutral rating and lowered its forecast to $350.

Benzinga Edge Scores

Broadcom’s Benzinga Edge rankings show strong quality but weaker value and growth scores.

The stock has a Momentum score of 45.7, a Quality score of 95.61, a Value score of 7.39 and a Growth score of 27.86.

The technical setup could improve if Broadcom moves back above the $368 to $377 area. A decline toward $335.50 would put support back in focus.

Broadcom Price Action

Broadcom shares were down 1.26% at $350.53 at the time of publication Thursday, according to Benzinga Pro data.

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