Asian Chip Stock Plunge Deepens Ahead of Tel Aviv Market Opening

Ahead of the Tel Aviv Stock Exchange opening, investors are closely monitoring a sharp sell-off in Asian semiconductor stocks following steep declines in the sector on Wall Street the previous evening. The local Tel Aviv market closed sharply lower yesterday, with losses intensifying near the close as technology gains on the New York Stock Exchange were erased. Seoul’s stock exchange plunged nearly 10%, with Samsung and SK Hynix shares each dropping over 11%. Japan also saw significant declines in chip stocks amid concerns over massive investments in artificial intelligence infrastructure and escalating competition from Chinese chip manufacturers.

The Asian downturn follows a 5% drop in Nvidia shares and a similar decline in AMD on Wall Street. In Tel Aviv, semiconductor stocks led the losses in the final minutes of trading, dragged down by the wiped-out technology sector gains in New York. Defense stocks also fell amid hopes for an end to attacks involving Iran and the US. Tower Semiconductor plunged 14.6%, recording the highest trading volume on the exchange at over 240 million shekels. Other chip companies also fell sharply, with Nova down 7.9% and Camtek losing 7.1%. The TA-35 index declined 2.2%, TA-125 fell 1.9%, TA Real Estate dropped 1%, TA Defense fell 3.7%, and TA Technology erased 3.5%, while TA Banks rose slightly by 0.6%.

Additional notable declines included Elbit Systems down 3.2%, Next Vision down 3.8%, Beit Shemesh Engines down 3.7%, Arit Industries down 2.5%, Ein Shelish down 11.1%, and Aerodrom down 13%. Conversely, NICE shares gained 7.2%, and Alumi rose 4.5% after Nofar Energy announced an increase in its holdings.

In Asia, the sell-off in chip stocks continued this morning, dragging markets lower. South Korea’s KOSPI index dropped 9.8%, Tokyo’s Nikkei fell 4%, Shanghai lost 1%, Shenzhen declined 3.4%, and Hong Kong’s Hang Seng slipped 0.3%. Samsung shares plunged 11.4%, SK Hynix fell 11.9%, and Japanese chip stocks also suffered steep losses: Tokyo Electron dropped 10.8%, Advantest lost 10%, SoftBank declined 5% due to its AI exposure via ARM holdings, and memory chipmaker Kioxia plunged 18%.