Asian Chip Stocks Rebound; Investors Await Key U.S. Tech Earnings
By Sherry Qin
Asian chip stocks rebounded after a market selloff last week, as investors awaited key U.S. technology earnings ahead for further clues on the sustainability of the artificial intelligence-led rally.
In Taiwan, TSMC, the world's largest contract chip maker, gained 3.2%. Foxconn Technology Group, the world's largest contract electronics manufacturer, added 5.1%, and chip designer MediaTek jumped 9.9%. The gains across semiconductor names sent the island's benchmark Taiex 3.9% higher Tuesday, on track for its best day since May.
South Korea's Kospi rose 4.5% as index heavyweights Samsung Electronics and SK Hynix--the world's two largest memory-chip makers--climbed 7.5% and 5.7%, respectively. In Japan, chip producer Kioxia advanced 15% and semiconductor-testing equipment manufacturer Advantest increased 7.0%.
Chinese foundries SMIC and Hua Hong Grace Semiconductor surged 8.8% and 17%, respectively, in Hong Kong.
Tuesday's rebound followed a plunge in Asian chip stocks in recent days as investors grew increasingly unsettled about massive spending on AI. The tech rout on Friday saw the Taiex notch its worst daily percentage loss since April 2025, while Japan's Nikkei Stock Average ended below 65000 for the first time in more than a month.
After the severe selloff, "markets are no longer in full liquidation mode, but the stabilization is fragile," said Patrick Munnelly, market strategy partner at Tickmill Group.
Investors have turned their attention back to corporate profits, with major tech companies including Intel and Alphabet slated to report earnings this week, for proof AI monetization is starting to materialize.
The key question is no longer whether AI demand remains strong, but whether record spending can turn into revenue, margins and cash flow, Saxo Markets chief investment strategist Charu Chanana said.
Analysts say the rally in AI and semiconductor stocks could resume next month if tech earnings substantially exceed consensus estimates, though they caution that the bar is high.
Write to Sherry Qin at sherry.qin@wsj.com
(END) Dow Jones Newswires
July 21, 2026 01:03 ET (05:03 GMT)
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