SK Hynix plunges as semiconductor selloff deepens; Samsung, Softbank

Semiconductor stocks fell in Asia on Tuesday, extending chipmakers’ decline after another weak session on Wall Street.

SK Hynix lost more than 13%, while Samsung Electronics fell more than 12%. Other AI-related names also saw heavy selling; Samsung SDI is down more than 10%, LG Innotek is down nearly 18%, Seoul Semiconductor is down nearly 7%, and LG Chem is down more than 6%.

Japan’s chip names were also rejected. Tokyo Electron fell almost 11%, cutting edge lost over 10 percent SoftBank GroupA major AI investment broker thanks to its shares ArmIt fell 6.3%. Shares of Japan’s computer memory maker Kioxia fell more than 18 percent.

Taiwan’s TSMC fell 2.9 percent. Mainland China’s technology-heavy ChiNext 300 index It fell 4.7%, while the Hang Seng China Semiconductor Chip Index fell 5%.

These sell-offs follow another weak session for U.S. semiconductor stocks on Monday. VanEck Semiconductor ETF (SMH) extended Friday’s losses, losing more than 2%. AMD and Teradyne fell 5% and 4%, respectively. Micron Technology lost nearly 2%.

The weakness underscores how closely intertwined Asian tech shares and U.S. AI trade are.

Samsung Electronics and SK Hynix are among the world’s largest suppliers of high-bandwidth memory chips used in AI servers, making their shares particularly sensitive to shifts in spending expectations of U.S. hyperscalers.

Owen Lamont, senior vice president at Acadian Asset Management, said the sharp swings in SK Hynix shares underscore the uncertainty surrounding the AI ​​investment cycle, arguing that investors still have little visibility into how the technology will ultimately impact the economy.

“We’re facing incredible uncertainty right now,” he told CNBC. “Nobody has any idea how this AI process will affect our economy, and so I think it’s going to be challenging no matter what.”

Lamont also added that leveraged exchange-traded products can contribute to market volatility, even if they are not solely responsible for SK Hynix’s recent volatility.

“More generally, the entire ecosystem of leveraged ETFs in Korea, as well as Hong Kong and the United States, is likely increasing volatility and magnifying market swings.”

The selloff also reflects a broader deterioration in sentiment for semiconductor stocks after recent media reports highlighted China’s ambitions for memory chips and lithography equipment, according to Sundeep Gantori, head of equity investment at Standard Chartered.

The long-term outlook remains intact, he said: “With the AI ​​investment cycle continuing to support leading technology companies, the market opportunity is large enough for multiple players to benefit and coexist.”

“The other reason behind today’s weakness in Korea is some brokers’ reports that memory prices will peak in 2027, which is not much different from our view,” Gantori said. While Standard Chartered expects memory prices to peak next year, it added that “it’s the risk-reward that matters, and risk-reward is increasing at current valuations.”