Nearly 1.9 Quadrillion Won in Global Semiconductor Market Value Wiped Out in Three Days

[Financial News]  

CNBC reported on the 29th local time that the market value of major semiconductor companies around the world had fallen by $1.3 trillion, or about 1.882 quadrillion won, this week alone amid investor selling.
That means the market capitalization of the top 20 semiconductor stocks by global market value shrank sharply from the close on the 24th.
NVIDIA lost $238 billion in market value, while SK hynix and Samsung Electronics shed $176 billion and $173 billion, respectively. Micron also lost $113 billion over the same period.
AMD lost $110 billion, and Taiwan's TSMC saw $119 billion wiped from its market capitalization.
Investors poured money into semiconductors, which have been among the biggest beneficiaries of the Artificial Intelligence (AI) boom.
The Philadelphia Semiconductor Index (SOX), made up of 30 U.S. semiconductor stocks, has surged 92% so far this year.
But the trend has recently reversed. The index has fallen by nearly 20% over the past month.
Michael Field, head of equity strategy at Morningstar, Inc., said, "This decline is being driven more by sentiment than by fundamentals," adding, "In short, semiconductor stocks are losing confidence."
Field noted that even if the issue is sentiment rather than fundamentals, the outlook is not bright given that these are growth stocks.
He added, "Many AI stocks are still continuing to rise," but said, "These are growth stocks, and much of their value comes from expectations for future cash flows." Field emphasized, "Those expectations are rooted in investor confidence."
Charlie Dai, vice president at Forrester, said the sharp sell-off reflects growing concerns that AI infrastructure spending could "peak faster than expected."
Dai said, "Investors are reassessing whether near-term revenue can justify the extraordinary AI spending," adding that "some are also worried about intensifying competition in semiconductors and AI infrastructure."
He added, however, that the current sell-off is "more about recalibrating expectations after a strong rally than about a slowdown in AI demand."
Meanwhile, Kieron Poon, head of Asian equity investments at Aberdeen Investments, said in a note on the 28th that recent weakness in Asian semiconductor stocks reflected "the ongoing deleveraging process in South Korea and weakened sentiment toward global tech stocks." He added that the recent volatility "does not change our long-term bullish view."


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