Memory stocks plunge on China fears and 2029 oversupply worries

Memory chip stocks SK Hynix, Samsung, and Micron have plunged this week amid broader market turmoil, driven by fears over Chinese competition and a potential 2029 oversupply. SK Hynix fell 26%, Samsung 22%, and Micron 11% in five days. The sell-off was triggered by China's CXMT announcing a new server memory architecture, though analysts question its production scalability. Traders also cite a South Korean column predicting a memory market "red ocean" in 2029, with Elon Musk responding that China will produce "a LOT of RAM" by 2028. Memory demand has surged due to AI, causing unprecedented price hikes, but manufacturers are expanding capacity with new factories taking 3-5 years to come online. Counterpoint Research forecasts DRAM prices falling 23% in 2028, though still up 230% from 2025, with long-term agreements potentially softening any downturn.