Semiconductor shares opened sharply lower on Asian markets on Tuesday, extending a decline that began during U.S. trading on Monday. Memory and chipmakers were among the hardest hit, with several major names posting double‑digit losses.
- SK Hynix fell more than 13 percent.
- Samsung Electronics dropped more than 12 percent.
Other AI‑related South Korean stocks also closed deeply in the red: Samsung SDI lost over 10 percent, LG Innotek nearly 18 percent, Seoul Semiconductor about 7 percent, and LG Chem more than 6 percent. Japanese chipmakers underperformed as well: Tokyo Electron slid almost 11 percent and Advantest fell more than 10 percent.
SoftBank Group declined 6.3 percent, a move observers linked to its stake in Arm, an important AI‑related investment. Japan’s Kioxia shares plunged over 18 percent. Taiwan Semiconductor Manufacturing Company (TSMC) eased 2.9 percent, while Chinese tech indices closed down roughly 4.7 and 5 percent.
The sell‑off in the Far East followed weakness in U.S. trading: the VanEck Semiconductor ETF fell more than 2 percent, AMD and Teradyne lost about 5 and 4 percent respectively, and Micron Technology slipped roughly 2 percent.
Reasons behind the drop
Samsung Electronics and SK Hynix are key suppliers of high‑bandwidth memory used in servers for artificial intelligence workloads, so their share prices are especially sensitive to shifts in capital expenditure expectations among major U.S. cloud providers.
Owen Lamont, vice president at Acadian Asset Management, said SK Hynix’s sharp move illustrates uncertainty around the technology investment cycle, as investors currently have limited visibility on how AI will influence the real economy. Szandíp Gantori, head of equities investing at Standard Chartered, argued the correction also reflects a broader deterioration in sentiment toward the sector, citing recent news about China’s ambitions in memory chips and lithography equipment.
Gantori added that the bank still views the sector’s long‑term prospects as favorable because the market is large enough for multiple players to benefit. He noted analyst forecasts that anticipate memory prices peaking around 2027, although Standard Chartered’s own estimates suggest that peak could arrive as early as next year.
What this means for investors
The breadth and speed of the sell‑off show how tightly linked Asian technology stocks have become to movements in the U.S. AI market. Increased short‑term volatility raises near‑term risks for investors, but analysts stress that longer‑term demand fundamentals and market structure may still provide opportunities for several competitors.
This article does not constitute investment advice or a recommendation.
