Chip Stock Sell-off Intensifies, Daylight between Japan and South Korea Markets

BlockBeats News, July 28th. Due to concerns about NVIDIA's major AI supply agreement and intensified market competition, investors' sentiment was dampened, leading to a sharp decline in the Japanese and South Korean stock markets. The Nikkei 225 index fell by as much as 4%, hitting its lowest level since May 22nd; the TOPIX index saw its largest drop of 2.7%. The South Korean KOSPI index plummeted by 7.6% at one point, marking a new low since April 20th. Stocks in Tokyo Electron, Kioxia, Samsung Electronics, and SK Hynix, among others in the semiconductor and equipment sectors, led the decline with drops of over 9%. In particular, Kioxia's stock price fell by 18% at one point, marking its largest decline since November last year.

Amid a wave of AI-related transactions totaling over $750 billion, NVIDIA's credit default swap costs surged, causing a tech stock downturn. Hideyuki Ishiguro, Chief Strategist at Nomura Asset Management, stated that following reports on significant investment deals involving NVIDIA, its credit risk increased, which investors interpreted as a bearish signal. Additionally, Ishiguro pointed out that China's progress in semiconductor manufacturing equipment poses a threat to Japanese suppliers, who have long held a competitive advantage in this field.