Chip Selloff Hits Stocks as Oil Gains Lift Yields: Markets Wrap
(Bloomberg) — A selloff in South Korean chipmakers drove global technology stocks lower, while oil and bond yields climbed after a fresh round of strikes in the Middle East over the weekend.
Worries that the artificial-intelligence boom has become overstretched sent SK Hynix Inc. and Samsung Electronics Co. plunging in Seoul. Nasdaq 100 futures slid 1% as semiconductor stocks such as Micron Technology Inc. fell sharply in premarket trading. S&P 500 contracts slipped 0.3%.
South Korea is increasingly shaping sentiment around the AI trade following the Kospi’s chip-driven outperformance this year. The rally has turned volatile in recent weeks as investors question whether AI hyperscalers’ spending will generate sufficiently strong returns to justify continued investment.
Traders furthermore pointed to the risk of a rotation into SK Hynix’s newly listed American depositary receipts, which surged on their debut on Friday. The ADR slid 8.2% in early trading on Monday.
An escalation in violence in the Middle East also weighed on sentiment as the US and Iran exchanged strikes into Monday and issued conflicting claims over whether the Strait of Hormuz was open. The flare-up sent Brent as much as 5% higher before paring gains to trade 3.3% higher at around $78.50 a barrel.
“The sharp selloff in Korean equities from the June peak is raising questions with some investors regarding the sustainability of the AI trade more broadly,” said Daniel Murray at EFG Asset Management. “With Middle East tensions rising again, this too has added to market consternation.”
Bonds in Europe and Asia were the hardest hit, with the yield on two-year UK gilts up seven basis points to 4.28%. Treasuries trimmed losses. The dollar barely budged while gold and Bitcoin fell.
“The market was almost feeling that the situation in the Middle East was concluded and so it was risk-on. What’s clear is that that’s not the case, so you’re seeing a lot more risk-off,” said Helen Jewell, international chief investment officer for fundamental equities at BlackRock Inc.
In a busy week where a multitude of catalysts can set the direction for markets, Kevin Warsh is due to make his first appearance before Congress as Fed chairman on Tuesday. The session will be preceded by June consumer price data from the Bureau of Labor Statistics.
Tuesday will also see a slew of earnings reports from Wall Street’s biggest banks, followed by critical tech earnings from chipmaking equipment maker ASML Holding NV the following day in Europe.
“This week is going to be one of volatile sideways movements before the rally can accelerate again,” said Joachim Klement, head of strategy at Panmure Liberum. “We do remain cautious about the AI trade, though, as this is still very much overbought.”
Corporate News:
Meta Platforms Inc. has committed to spending an additional $40 billion on its sprawling data center campus in Louisiana, pushing its total expected investment beyond $250 billion for the site. Taiwan Semiconductor Manufacturing Co. reported quarterly sales rose 36%, meeting high expectations and signaling global demand for AI hardware remains intact. Seven & i Holdings Co.’s move toward selling a stake to SoftBank Corp. and PayPay Corp. signals a willingness to surrender some control over its future in return for the benefits of being allied with key strategic partners. Nippon Paint Holdings Co. has made multiple offers for Akzo Nobel NV’s decorative paints business in the past month, according to people with knowledge of the matter. Some of the main moves in markets:
Stocks
S&P 500 futures fell 0.3% as of 6:33 a.m. New York time Nasdaq 100 futures fell 1% Futures on the Dow Jones Industrial Average were little changed The Stoxx Europe 600 fell 0.2% The MSCI World Index was little changed Currencies
The Bloomberg Dollar Spot Index was little changed The euro rose 0.1% to $1.1429 The British pound fell 0.1% to $1.3384 The Japanese yen fell 0.3% to 162.11 per dollar Cryptocurrencies
Bitcoin fell 1.7% to $63,054.61 Ether fell 2.1% to $1,781.88 Bonds
The yield on 10-year Treasuries advanced one basis point to 4.57% Germany’s 10-year yield advanced two basis points to 3.09% Britain’s 10-year yield advanced five basis points to 4.92% Commodities
West Texas Intermediate crude rose 3.2% to $73.71 a barrel Spot gold fell 1.3% to $4,066.84 an ounce This story was produced with the assistance of Bloomberg Automation.
–With assistance from Macarena Muñoz, Sagarika Jaisinghani and Kurt Schussler.
©2026 Bloomberg L.P.
