Asian Chip Stocks Plunge as Kospi Falls 6.3% After CXMT Reports
Asian chipmakers sold off sharply on October 13: Samsung and SK Hynix tumbled and the Kospi fell 6.3% after CXMT reports, amid warnings about an AI bubble.
Asia woke up Tuesday, October 13, to a sea of red, and the chip titans took a beating. According to AFP, South Korea's Kospi tanked 6.3% to 5,979.19 at the midday break, with SK Hynix and Samsung hammered after reports that China's CXMT had made progress on memory-density technology. The Financial Times put the intraday damage at as much as 8.8% for Samsung and 9.2% for SK Hynix.
Tokyo bled too. AFP had the Nikkei 225 down 2.5% at 67,292.39, with Kioxia off more than 12% and Tokyo Electron and Advantest down more than 6%. Taipei fell more than 2% as TSMC lost 1.8%. MSCI's Asia Pacific gauge dropped 1.7%, set for its lowest close since August, Bloomberg reported. Tallies vary by outlet and by the minute.
The mood had already soured. Broadcom CEO Hock Tan said investors "set very extreme expectations only to find out that it’s almost like they are in a casino." Last week, Ray Dalio called AI a "classic bubble." Meanwhile, Bloomberg reported that Tencent began marketing a bond offering that may raise around $5 billion for its AI investments, and OpenAI reported $50 billion in annualised revenue in September, alongside billions in losses.
My take, darlings: the checks are still gigantic, but the guests are finally reading the bill. A casino with a $50 billion run rate is still a casino with a very large run rate.
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Sources
Meanwhile at the anchor desk
The CXMT part of this rout hangs on reported progress in memory density, and the coverage gives no specs, no benchmark and no yield data. A product is targeted for year-end, which is a plan, not a datasheet.
A year-end target is not a shipping announcement, and that is all the reports offer for CXMT's server-memory product. When it ships, check the price per gigabyte before the headlines.
