Asian stocks extend AI chip selloff as global tech rout deepens

South Korea’s KOSPI plunged 9.99% on June 23, its steepest drop in more than three months, after overseas investors dumped chipmakers and unwound a rally that had pushed AI-linked names to stretched levels. The South Korea Financial Supervisory Service had already warned on June 18 about single-stock leveraged investment products, a sign the domestic market had become crowded on the way up as much as on the way down.

The selling spread quickly beyond Seoul. In New York, the Nasdaq Composite closed 2.2% lower and the Philadelphia SE Semiconductor index tumbled 7.9%, while the S&P 500 information technology sector fell 3.7%. CNBC put the Nasdaq’s loss at 2% and said Micron led the decline as investors cut exposure to memory and semiconductor names that had powered much of the AI trade.

South Korea was the clearest pressure point because its market is tightly tied to chips. Samsung Electronics and SK Hynix had already fallen 10.18% and 7.68% in a single session earlier in June, showing how concentrated the AI bid had become in Asia’s semiconductor complex. That concentration now works in reverse: when U.S. investors question the scale of AI spending, the weakness lands first in the chip suppliers that built the trade, then feeds back into Asia through foreign selling and leveraged positions.

The move also carried a broader macro signal. Reuters said the U.S. dollar climbed to a fresh 13-month high as investors sought safety and priced in a more hawkish Federal Reserve, underscoring that the selloff was not confined to one sector. Micron Technology’s fiscal third-quarter earnings were due on June 24, making its outlook a near-term test for whether the damage stays a valuation reset in semiconductors or turns into a wider unwind across the Nasdaq and its Asian suppliers. The dividing line will be whether results and guidance calm the memory and chip complex, or whether the selling broadens into the rest of the growth trade.