LONDON, June 23, 2026 – A sweeping rout in global semiconductor stocks erased more than $1 trillion in Nasdaq 100 premarket value Tuesday, as mounting skepticism over the profitability of massive artificial intelligence infrastructure investments triggered widespread losses across Asia, Europe, and the United States.
South Korea's KOSPI index plummeted 9.99%, leading declines in Asia, while Nasdaq 100 futures shed 2.7% ahead of the Wall Street open. The Philadelphia Semiconductor Index, which had hit an all-time high just a day earlier, faced a sharp reversal as investors reassessed the sustainability of the sector's rally.
"Former generals ... appear to have lost momentum," said Chris Weston, head of research at Pepperstone, noting the sudden shift in sentiment. The selloff was broad-based, with Nvidia falling nearly 3% in premarket trading, while Intel, Marvell Technology, and Advanced Micro Devices dropped between 5.5% and 7.5%. Micron Technology slid 8.6% ahead of its fiscal third-quarter results due June 24, which could further sway memory chip shares.
"Concern is returning that large technology firms are spending too much on AI infrastructure," said Ipek Ozkardeskaya, senior analyst at Swissquote Bank. Big institutional investors are increasingly pressing hyperscalers to demonstrate that AI investments can generate returns sufficient to cover enormous capital expenditures. Traders are now pricing in 50 basis points of Federal Reserve rate hikes by December, reflecting broader market jitters.
In Seoul, the KOSPI tumbled to 8,203.84, triggering a 20-minute trading halt. Samsung Electronics and SK Hynix each dropped over 12%. "Volatility has blown out," said Alexander Redman, chief equity strategist at CLSA, attributing the moves to heavy retail margin positions and leveraged funds chasing larger daily swings.
European technology stocks also suffered, with the STOXX 600 technology index losing 3.4%, on track for its worst session since February. ASML and Aixtron fell more than 5%, while STMicroelectronics dropped 7.5% and Infineon slid 5.7%. "Investors may question earnings sustainability as firms continue to borrow before AI bets pay off," said Kiran Ganesh at UBS.
The downturn comes after SK Hynix briefly surpassed Samsung as South Korea's most valuable company on Monday, following a more than 340% surge in its stock this year, driven by its dominance in high-bandwidth memory for AI chips. "Customized AI memory had changed the industry's economics," said Kim Sunwoo, analyst at Meritz Securities. However, Tuesday's selling erased those gains.
Tuesday's decline recalled the June 5 rout, when the Philadelphia chip index dropped 10.3%—its worst one-day slide since March 2020—after Broadcom's custom AI-chip outlook missed elevated expectations. Wells Fargo's Ohsung Kwon described the sector as "way overbought" but argued the drop does not signal the end of the semiconductor bull market.
Looking ahead, Micron's earnings report on June 24 could be pivotal. A strong forecast might support memory stocks, but a shortfall or a fresh surge in bond yields could deepen the pullback. Thomas Mathews, who oversees Asia-Pacific markets at Capital Economics, noted that profitable chipmakers and a solid economy are "not typically a backdrop for a sustained drawdown." However, he warned that concentrated bets in the sector remain a risk for another sharp drop.
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