AI market shake-up sparks global chip rally and sell-off

China’s CXMT entered the Shanghai market with a 466% jump, highlighting a surge in domestic memory-chip capacity amid a global DRAM shortage. Simultaneously, reports that Beijing has developed deep-ultraviolet lithography tools - a technology previously monopolised by ASML - unsettled investors, prompting a sell-off in AI-linked equities worldwide. South Korea’s Kospi fell over 17% across two days, led by SK Hynix and Samsung, while the Nasdaq slipped into correction after a 10% decline, briefly dethroning Nvidia as the world’s most valuable listed firm.

Analysts contend CXMT’s DRAM products complement rather than challenge Nvidia’s GPU dominance, and that China’s lithography ambitions are still far from replacing ASML’s output. The market steadied after robust quarterly results from Amazon and Microsoft, lifting the Kospi nearly 20% despite the week’s overall slump, the deepest since the 2008 financial crisis. The episode underscores the fragility of an AI economy heavily weighted toward a single chipmaker and the broader geopolitical tensions shaping the semiconductor supply chain.