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FinanceSK Hynix shares plunge 9% as Asian tech rout follows US chip sell-off
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Asian semiconductor stocks tumbled on Thursday, July 16, 2026, as a sell-off in U.S. chipmakers spilled into the region. SK Hynix shares plunged over 9% in Seoul, reversing the previous session's 8% rally, amid continued volatility since its U.S. listing. Samsung Electronics dropped more than 7%, and other regional firms like Advantest, SoftBank Group, and Tokyo Electron also fell sharply. The losses followed a U.S. sell-off where Micron Technology sank 8% and Intel lost over 4%. The declines occurred despite strong earnings from ASML, which raised its full-year sales guidance. A trader noted that semiconductors now make up roughly 20% of the S&P 500, a level seen as unsustainable and reminiscent of the dot-com bubble, warning that valuations may be due for a correction.
Source report
Asian semiconductor stocks fell sharply on Thursday, as a sell-off in U.S. chipmakers spilled into the region. SK Hynix continued to experience significant volatility following its U.S. listing last week.
Key Market Movers
- SK Hynix tumbled over 9% in Seoul, reversing the previous session's 8% rally. The stock had already recorded its steepest one-day decline on Monday as investors locked in profits amid growing concerns over AI spending.
- Samsung Electronics dropped more than 7%.
- Seoul Semiconductor fell more than 5%.
- LG Innotek lost about 1%.
- Samsung SDI was down over 2%.
Regional Weakness
The sell-off extended across Asia:
- Japan:
- Advantest (AI-linked equipment maker): fell more than 6%
- SoftBank Group: slid nearly 7%
- Tokyo Electron: lost over 5%
- Renesas Electronics: declined 4%
U.S. Overnight Losses
The Asian declines followed a sell-off in U.S. semiconductor shares:
- Micron Technology: sank 8%
- Intel: lost more than 4%
- Lam Research: fell about 3%
- Advanced Micro Devices: fell about 3%
Context: ASML's Strong Results
The losses came despite strong earnings from ASML. The Dutch chip-equipment maker raised its full-year sales guidance for a second time this year, forecasting revenue of €43 billion to €45 billion — above analysts' expectations — while outlining plans to further ramp production of its extreme ultraviolet lithography machines.
Analyst Commentary
Louis Kondratev, trader at XFUNDs, said the recent pullback reflects how crowded semiconductor trades have become after a prolonged AI-driven rally.
"Semiconductors alone now make up roughly 20% of the S&P 500, which is incredibly difficult to sustain," he said.
He noted that during the dot-com bubble of 2000, semiconductors were just over 8% of the index, and they have historically averaged between 2% and 5%.
While earnings momentum has remained robust, he warned that the pace of gains may become harder to sustain as investors reassess lofty valuations.
"Earnings momentum has been very strong, but it's mostly concentrated in semiconductors, and that momentum may begin to slow as valuations find their place," he said.
Image: SK Hynix Inc. signage at the company's office in Seongnam, South Korea, on Tuesday, June 30, 2026. (SeongJoon Cho | Bloomberg | Getty Images)
Source
US Top News and AnalysisWestern
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