Global chip stocks tumble as AI market jitters rattle investors in US and Asia

Global chip stocks experienced a significant downturn in US and Asian markets, as investor anxiety mounted over the artificial intelligence sector. Major manufacturers saw their share prices slide amid questions about whether massive investments in AI infrastructure will yield sufficient returns to justify current high valuations. This apprehension has also been fueled by concerns surrounding the financing models for AI development, including reports of a major chipmaker potentially offering substantial financial backing for an AI data center.

The sell-off was particularly acute in Asia on Tuesday, July 28, 2026. South Korea's Kospi index plunged by approximately 10%, triggering market halts, with key players like Samsung Electronics and SK Hynix experiencing steep declines of over 13%. Japanese and Taiwanese chip-related companies, including Kioxia and MediaTek, also faced considerable losses. In the US, companies such as Nvidia saw their stock prices fall, contributing to a broader cautious mood in global markets.

Adding to the jitters is the increasing competitive landscape, particularly from China. Reports indicate that Chinese manufacturers are advancing in domestic production of sophisticated chipmaking equipment, alongside the strong market debut of Chinese memory-chip producer ChangXin Memory Technologies (CXMT). This shift intensifies worries among investors about the future market position of established global suppliers and the potential for a more distributed share of AI-related profits.