The Philadelphia Semiconductor Index slipped into bear-market territory on Tuesday before extending losses beyond 5 percent on Wednesday, as a global chip rout that erased over $1 trillion from sector valuations earlier this week deepened. The Nasdaq-100 also entered correction territory, with Samsung and SK Hynix shares tumbling more than 15 percent and Kioxia falling 18 percent.
Wall Street followed suit, with the S&P 500 dropping 1.52 percent, the Dow Jones 2.19 percent and the Nasdaq-100 2.06 percent on Wednesday after the Federal Open Market Committee held its benchmark rate at 3.50 to 3.75 percent in a 9-3 vote. The KOSPI has now fallen more than 30 percent from its record high.
Despite the selloff, SK Hynix posted a record second-quarter operating profit, up 557 percent year-on-year, and plans to raise 2026 capital expenditure by roughly 50 percent to at least $31 billion. Alphabet lifted its own capex forecast to as much as $205 billion, underscoring that AI-related spending is projected to approach $870 billion by year-end. Apple surpassed Nvidia as the world's largest public company, while Hong Kong stocks fell 1.91 percent and the Nikkei dipped 1.01 percent on Wednesday amid new US restrictions on Nvidia chip sales to China.