AI anxiety sparks tech rout, broad selloff in Asian markets

By Tom Westbrook and Ankur Banerjee

SINGAPORE, July 28 (Reuters) - Chip stocks tanked crossed Asia connected Tuesday, rattled by the menace of Chinese contention and worries astir who's paying for the AI boom, portion sliding lipid prices did small to allay nerves astir U.S. complaint ‌hikes perchance starting arsenic soon arsenic this week.

South Korea's KOSPI dived astir 10% to a three-month low, triggering a circuit breaker connected the mode ‌down arsenic it heads for its largest monthly autumn since the Asian fiscal situation successful 1997. The scale had much than tripled implicit 12 months to June, but it has shed much ​than a 3rd of its worth since that peak.

Shares successful SK Hynix and Samsung Electronics, which are nether other unit successful a marketplace transformed by leverage, made losses of much than 12% arsenic their stratospheric rally unwinds successful a hurry.

Japan's Nikkei slid astir 4%, touching a two-year low, with the selloff pursuing a 2.2% driblet for the Philadelphia Semiconductor scale connected Monday.

"There is nary 1 reddish emblem that's moving the market," said Chris Weston, caput of probe astatine broker Pepperstone successful Melbourne, but alternatively a ‌combination of nerves astir AI backing and China's emergence ⁠as a rival each on the proviso chain.

China has begun manufacturing domestically developed immersion heavy ultraviolet lithography machines, a chipmaking instrumentality agelong dominated by Dutch supplier ASML, The Information reported connected Monday, sending ASML shares down 8.5%.

China's CXMT Corp, the world's fourth-biggest ⁠memory maker, listed and raised $8.6 cardinal connected Monday, too, ending its debut league arsenic China's astir invaluable company.

"The market's interest lies little successful CXMT's existent net and much successful its imaginable for accelerated capableness enlargement to rival Korean companies," said Kim Seok-hwan, a Seoul-based marketplace expert astatine Mirae Asset Securities.

Nvidia shares had already shed 5% overnight aft the ​Wall ​Street Journal reported the institution is successful talks to supply astir $250 cardinal successful financing guarantees ​for OpenAI arsenic portion of a monolithic information centre project.

CXMT shares ‌were past astir 3% little successful bumpy commercialized successful Shanghai, portion successful Tokyo marketplace darlings Kioxia, down 18%, and Tokyo Electron, down 11%, were among the apical losers.

OIL SLIDES, US RATE HIKE EYED

Brent crude futures extended Monday's astir 9% plunge, falling much than 1% to $87.19 a barrel, arsenic a lull successful hostilities betwixt the U.S. and Iran followed Washington's abrupt suspension of aerial strikes connected Saturday.

President Donald Trump said connected Monday the United States was having "good talks" with Iran and determination was a accidental of a deal.