Global Chip Stocks Tumble as Rate Hike Fears and AI Debt Concerns Spread

A global selloff in chip stocks deepened Thursday, with South Korea's Kospi plunging 7.6% and triggering a circuit breaker, after a hotter US inflation reading fueled expectations of further interest rate hikes and heightened concerns about debt-funded AI expansion. Chip giants SK Hynix and Samsung Electronics led losses, dropping 11% and 9.5%, respectively, while US stocks like Nvidia, Micron, and Marvell fell in premarket trading. European firms ASML and STMicroelectronics also declined sharply, with the selloff extending despite strong earnings from TSMC and ASML. The rout follows reports of Chinese chip firm CXMT's advances on new memory architecture, reigniting competition worries. September's US inflation data has boosted bets the Federal Reserve could raise rates again this month, making debt more expensive for tech companies funding AI capacity.