MW These cybersecurity stocks are falling as U.S.-China tensions hit a new corner of the tech industry

By Christine Ji

Shares of Fortinet, Palo Alto Networks and other cybersecurity players dropped on news of a reported crackdown from Beijing

Shares of Fortinet were down 4.1% in Wednesday's premarket action.

Tensions between the U.S. and China are flaring up again, and this time cybersecurity firms are caught in the crossfire.

On Wednesday morning, Reuters reported that Chinese regulators have ordered domestic firms to stop using software from roughly a dozen U.S. and Israeli cybersecurity companies, citing national security concerns. The list of targeted firms reportedly includes Palo Alto Networks (PANW), Fortinet $(FTNT)$ and Broadcom's $(AVGO)$ VMware, as well as Israel's Check Point Software Technologies $(CHKP)$.

The news sent Fortinet's stock down 4.1% in premarket trading. Shares of Palo Alto Networks were down 3%. Shares of Broadcom and Check Point Software saw milder declines of 1.2% and 1.8%, respectively.

Fortinet, Palo Alto Networks, Broadcom and Check Point didn't immediately respond to a MarketWatch request for comment.

See also: Salesforce and Adobe see their stocks slide as AI fears intensify

Chinese officials are concerned that these companies' products could be used to collect sensitive data and transmit it abroad. It's the latest push from Beijing to encourage homegrown technology and reduce China's reliance on foreign companies.

A similar conflict has been playing out related to Nvidia's (NVDA) ability to sell artificial-intelligence chips in the China market.

After the Trump Administration approved limited sales of Nvidia's H200 chip to China on Tuesday, Chinese officials have told customs agents to prohibit the entrance of H200 chips into the country, according to a separate Reuters report on Wednesday. Regulators reportedly met with local tech companies on Tuesday, explicitly instructing them to limit purchases of the chips unless absolutely necessary.

Read: Nvidia's stock was just named a top pick for a reason that might be surprising

Nvidia didn't immediately respond to a MarketWatch request for comment.

-Christine Ji

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January 14, 2026 08:35 ET (13:35 GMT)

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