▲ CXMT semiconductor plant in Hefei
A confluence of concerns over interest rate hikes, heavy investment burdens in artificial intelligence (AI), and expectations of Chinese memory chipmakers catching up has prolonged a sharp decline in global AI and semiconductor stocks.
According to U.S. broadcaster CNBC on the 15th (local time), the combined market capitalization of the top 20 global AI and semiconductor companies evaporated by more than $1 trillion (approx. 1,340 trillion won) over four trading days this week (12th to 15th).
Nvidia, the bellwether of AI stocks, saw its share price drop by 5.3%, wiping out about $291 billion (approx. 391 trillion won) in market value.
SK Hynix ($243.8 billion) and Samsung Electronics ($237.3 billion) followed.
The decline for the three major memory makers—Samsung Electronics, SK Hynix, and Micron—accounted for approximately 40% of the total loss.
According to data compiled by U.S. financial media outlet Benzinga, the market capitalization of six memory and storage companies—Samsung Electronics, SK Hynix, Micron, Kioxia, SanDisk, and Western Digital—has plummeted by $1.09 trillion (approx. 1,463 trillion won) since the 2nd.
In the New York stock market that day, Nvidia (-1.8%), Intel (-2.8%), and AMD (-1.5%) declined, while Dell Technologies plunged 6.8%.
Even strong earnings from TSMC failed to reverse the downward trend.
TSMC projected its fourth-quarter revenue to reach up to $54.3 billion (approx. 72.9 trillion won), beating market expectations.
However, TSMC shares fell 2.0% on the Taiwan stock market that day, and its American Depositary Receipts (ADRs) listed in New York also dropped 1.8%.
While speculations that the AI-driven "super cycle" may be coming to an end are rattling the market, a considerable number of counterarguments suggest there will not be a price crash like in the past.
Concerns that the Federal Reserve's outlook for additional interest rate hikes would increase the cost of financing AI data center construction, coupled with China's ChangXin Memory Technologies (CXMT) recently unveiling a new structural technology that increases memory integration, have heightened competitive worries.
In response to the oversupply theory for memory chips by 2029 raised by these events, Tesla CEO Elon Musk posted on X, saying, "China will produce a massive amount of RAM in 2028."
Some perspectives suggest that the shock originating from China could be concentrated on South Korean companies.
Gil Luria, an analyst at D.A. Davidson, told CNBC, "If there's an impact, it'll be on SK Hynix and Samsung, and not Micron."
Indeed, Micron fluctuated before closing up 1.9% that day.
(Photo: Yonhap News)
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