Samsung, SK Hynix slide amid Nvidia financing worries, China competition

The sector-wide selloff followed several developments that renewed doubts about the sustainability of the AI-driven semiconductor rally.

SK Hynix, a key supplier of high-bandwidth memory (HBM) chips to Nvidia, has been one of the biggest beneficiaries of the AI spending boom, making its shares particularly sensitive to shifts in investor sentiment toward the sector.

Analysts said the selloff reflected a combination of concerns over AI infrastructure financing, China's technological advances and rising competition from Chinese firms.

A Wall Street Journal report that Nvidia could provide a roughly $250 billion financial backstop for an OpenAI data-centre project sent Nvidia shares down nearly 5%, with investors questioning the extent to which the AI chip leader may be financing its own customers.

Separately, investors were unsettled by reports of China's progress in developing homegrown deep ultraviolet (DUV) lithography tools, a potential step toward reducing the country's reliance on Western semiconductor equipment despite U.S. restrictions on Chinese access to imported chip technology.