Asian technology stocks tumbled on Tuesday after China's leading memory-chip maker signalled a breakthrough that could intensify competition in the lucrative market for server memory, rattling investors already nervous about the sustainability of the AI boom.
ChangXin Memory Technologies (CXMT), China's largest DRAM manufacturer, said at an event in Shanghai that it expects to release a server-memory module by the end of the year built on a new cell architecture that makes each memory cell a third smaller than in the conventional layout, allowing more memory to be fitted onto every silicon wafer. The first product on the design will be a DDR5 registered dual in-line memory module (RDIMM), the standard format used in data-centre servers, according to Aju Press.
Seoul and Tokyo lead the rout
South Korea's KOSPI fell 5.1 percent, according to Aju Press, with chip giants SK Hynix down 7.17 percent to 1,490,000 won and Samsung Electronics down 5.79 percent to 236,000 won. Foreign investors sold a net 1.03 trillion won of SK Hynix alone. AFP reported even steeper moves, with the KOSPI tanking more than six percent and Japan's Nikkei 225 losing nearly three percent, as chipmaker Kioxia tumbled more than 12 percent and Tokyo Electron and Advantest fell over six percent. Taiwan's market dropped two percent on a 1.8 percent fall in TSMC, while MSCI's broadest index of Asia-Pacific shares outside Japan fell more than two percent to its lowest level since late July, Reuters reported.
AI-spending doubts deepen
The selloff was compounded by comments from Broadcom chief executive Hock Tan, who compared AI investors to gamblers in "a casino," saying many "have no clue what they are investing in" — remarks that unsettled a market already questioning when firms will see returns on their vast AI investments.
"China continues to narrow the competitive gap with US companies across AI models, humanoid robotics, memory and other parts of the technology supply chain," Pepperstone's Chris Weston said, while Rayliant Global Advisors' Phillip Wool called the CXMT breakthrough a significant milestone for Chinese chipmakers, though he cautioned the market reaction looked disproportionate given CXMT has yet to demonstrate large-scale production and still lags the Korean leaders in market share.
Sources:
Aju Press: Chinese chip challenge pushes Seoul index to 6,000 edge
AFP/eNCA: Seoul, Tokyo stocks plunge as Asia suffers fresh tech rout
Reuters/AnewZ: Asian stocks tumble as China fuels AI chip fears
ChangXin Memory Technologies (CXMT), China's largest DRAM manufacturer, said at an event in Shanghai that it expects to release a server-memory module by the end of the year built on a new cell architecture that makes each memory cell a third smaller than in the conventional layout, allowing more memory to be fitted onto every silicon wafer. The first product on the design will be a DDR5 registered dual in-line memory module (RDIMM), the standard format used in data-centre servers, according to Aju Press.
Seoul and Tokyo lead the rout
South Korea's KOSPI fell 5.1 percent, according to Aju Press, with chip giants SK Hynix down 7.17 percent to 1,490,000 won and Samsung Electronics down 5.79 percent to 236,000 won. Foreign investors sold a net 1.03 trillion won of SK Hynix alone. AFP reported even steeper moves, with the KOSPI tanking more than six percent and Japan's Nikkei 225 losing nearly three percent, as chipmaker Kioxia tumbled more than 12 percent and Tokyo Electron and Advantest fell over six percent. Taiwan's market dropped two percent on a 1.8 percent fall in TSMC, while MSCI's broadest index of Asia-Pacific shares outside Japan fell more than two percent to its lowest level since late July, Reuters reported.
AI-spending doubts deepen
The selloff was compounded by comments from Broadcom chief executive Hock Tan, who compared AI investors to gamblers in "a casino," saying many "have no clue what they are investing in" — remarks that unsettled a market already questioning when firms will see returns on their vast AI investments.
"China continues to narrow the competitive gap with US companies across AI models, humanoid robotics, memory and other parts of the technology supply chain," Pepperstone's Chris Weston said, while Rayliant Global Advisors' Phillip Wool called the CXMT breakthrough a significant milestone for Chinese chipmakers, though he cautioned the market reaction looked disproportionate given CXMT has yet to demonstrate large-scale production and still lags the Korean leaders in market share.
Sources:
Aju Press: Chinese chip challenge pushes Seoul index to 6,000 edge
AFP/eNCA: Seoul, Tokyo stocks plunge as Asia suffers fresh tech rout
Reuters/AnewZ: Asian stocks tumble as China fuels AI chip fears
