{"slug": "asia-s-chip-darlings-are-getting-crushed-after-a-blockbuster-run", "title": "Asia's chip darlings are getting crushed after a blockbuster run", "summary": "Asia's AI chip rally is unraveling as investors balk at sky-high valuations and rising market volatility. Japan's Kioxia has lost half its value since peaking after a blockbuster AI-fueled stock surge, while Samsung and SK Hynix have each shed about a third of their value. South Korea is cracking down on speculative trading after AI chip stocks fueled a market frenzy.", "body_md": "# Asia's chip darlings are getting crushed after a blockbuster run\n\n[Business Insider](https://www.businessinsider.com)\n\nKioxia's stock has halved from its peak, while Samsung and SK Hynix have each shed about a third of their value as Asia's AI chip rally cools.\n\n- Asia's AI chip rally is unraveling as investors balk at sky-high valuations and rising market volatility.\n- Japan's Kioxia has lost half its value since peaking after a blockbuster AI-fueled stock surge.\n- South Korea is cracking down on speculative trading after AI chip stocks fueled a market frenzy.\n\nAsia's chip makers have been on a monster [AI-fueled rally](https://www.businessinsider.com/kospi-stock-index-goldman-sachs-samsung-sk-hynix-goldman-sachs-2026-7) this year.\n\nBut after months of relentless gains, some of the region's biggest winners are tumbling as investors question lofty valuations and South Korea moves to rein in speculative trading in one of this year's hottest stock markets.\n\nNowhere is the reversal more striking than at Japan's Kioxia.\n\nThe [memory chipmaker](https://www.businessinsider.com/best-performing-non-us-stocks-ai-boom-korea-taiwan-japan-2026-7) was the second-best-performing non-US stock in the MSCI All Country World Investable Market Index in the first half of the year, soaring 631%. Last month, it became Japan's most valuable listed company.\n\nThat momentum has unraveled quickly.\n\nKioxia shares plunged 16% on Friday following an overnight sell-off in [US-listed memory stocks.](https://www.businessinsider.com/tsmc-earnings-chip-stocks-selloff-ai-nvda-tsm-stock-market-2026-7) The stock has halved since its June peak, wiping about 30 trillion yen, or roughly $185 billion, off its market value.\n\nThe sell-off spread across the region on Friday.\n\nTaiwan Semiconductor Manufacturing Co., the world's largest contract chipmaker, fell over 5% despite reporting blockbuster second-quarter earnings on Thursday, with profits surging 77% from a year earlier.\n\nSouth Korea's market was closed on Friday, but Samsung Electronics and SK Hynix have already fallen roughly one-third from their peaks this year. SK Hynix's Nasdaq-listed shares closed 14% lower on Thursday.\n\nThe weakness followed South Korea's decision to tighten rules on single-stock leveraged exchange-traded funds after weeks of sharp market swings. Regulators said the measures were aimed at cooling excessive speculation.\n\nSouth Korea had been one of the world's hottest equity markets this year, with the rally fueled in part by heavy retail participation and leveraged bets concentrated in AI-related names.\n\nTop economist and former PIMCO CEO Mohamed El-Erian said South Korean authorities face a delicate balancing act: tackling inflation while heading off excessive financial volatility that could trigger \"disorderly deleveraging.\"\n\n\"How this plays out over the coming weeks is worth watching: It's not an easy mix to manage, and the latter, if mismanaged, could have some cross-border spillovers,\" he wrote on X on Thursday.\n\n[Business Insider](https://www.businessinsider.com/nikkei-225-kospi-index-kioxia-tsmc-hynix-samsung-chip-selloff-2026-7)\n\nGet AI news in your inbox\n\nDaily digest of what matters in AI.", "url": "https://wpnews.pro/news/asia-s-chip-darlings-are-getting-crushed-after-a-blockbuster-run", "canonical_source": "https://www.machinebrief.com/news/asias-chip-darlings-are-getting-crushed-after-a-blockbuster-t9ui", "published_at": "2026-07-17 07:20:51+00:00", "updated_at": "2026-07-17 10:37:21.977979+00:00", "lang": "en", "topics": ["ai-chips", "artificial-intelligence"], "entities": ["Kioxia", "Samsung", "SK Hynix", "Taiwan Semiconductor Manufacturing Co.", "Mohamed El-Erian"], "alternates": {"html": "https://wpnews.pro/news/asia-s-chip-darlings-are-getting-crushed-after-a-blockbuster-run", "markdown": "https://wpnews.pro/news/asia-s-chip-darlings-are-getting-crushed-after-a-blockbuster-run.md", "text": "https://wpnews.pro/news/asia-s-chip-darlings-are-getting-crushed-after-a-blockbuster-run.txt", "jsonld": "https://wpnews.pro/news/asia-s-chip-darlings-are-getting-crushed-after-a-blockbuster-run.jsonld"}}