Micron Technology stock fell 6.6% on July 28, 2026, as South Korea’s KOSPI index plunged 10.8% overnight in a broad sell-off of chipmaking stocks driven by mounting concerns about artificial intelligence spending and Chinese competition.
The sharp decline in Seoul rippled across global markets, with SK Hynix and Samsung Electronics suffering heavy losses that dragged the benchmark Korean index down to levels unseen in weeks. The sell-off extended to the U.S., where semiconductor stocks faced fresh pressure amid growing investor anxiety about whether the AI investment boom can deliver promised returns.
Analysts attributed the sharp reversal to two converging concerns. One was the sustainability of massive spending by hyperscalers—tech giants like Amazon, Google, and Meta—who have been pouring billions into AI infrastructure and memory chips. The other was anxiety that lower-cost AI models emerging from China could reduce demand for premium memory and computing power.
Morningstar equity analyst Jing Jie Yu said the market “was likely spooked by the progress of China’s chipmaking equipment capabilities, and was worried that this progress would threaten the competitive position of global chipmaking and chip equipment leaders.” However, Yu added that “the sell-off today is largely a knee-jerk reaction and overdone,” arguing that dominant global chipmakers are unlikely to face meaningful competitive threats.
Micron had been a standout winner from the AI boom, more than tripling in value during 2026 after delivering blockbuster growth. In its quarter ended May 28, revenue more than quadrupled from the year-earlier period. But the stock’s massive run-up had made it vulnerable to profit-taking and sentiment shifts, particularly as investors began questioning whether hyperscaler spending could sustain the explosive growth rates of the past year.
The broader semiconductor sector came under pressure globally. Advanced Micro Devices fell 7.8% and Applied Materials dropped 7.9% in U.S. trading, each weighed down by the same concerns about AI investment sustainability and Chinese competition that had rattled Seoul. The declines came ahead of earnings reports from major hyperscaler customers—Meta and Microsoft on Wednesday and Amazon on Thursday—that could offer clarity on future capital spending plans.
The sell-off underscored how concentrated the AI trade had become in a small number of chipmaking stocks, with the heaviest losses falling on memory chip suppliers that had benefited most from the data center buildout. When sentiment shifted, the impact was swift and severe, particularly in markets like South Korea where Samsung and SK Hynix dominate the index and the economy.
Sources
- Associated Press — reporting on July 28, 2026, detailing Micron’s 9.1% decline, KOSPI’s 10.8% plunge, and analyst commentary from Jing Jie Yu of Morningstar on China’s chipmaking progress and market sentiment
- Nikkei Asia — reporting on South Korea’s KOSPI plunge amid concerns over Chinese chip competition and AI spending fears
- Yahoo Finance — reporting on Korean stocks sinking as chipmakers plunge amid deepening concerns over crowded equity positioning and rising corporate debt
- Reuters — reporting on South Korea’s KOSPI posting its biggest fall on global chipmaker selloff
