Nvidia (NVDA)·SK Hynix, 'Direct Hit' from China's Pursuit...Memory Stocks 'Evaporate' $541 Billion

▲ Semiconductors, downturn/AI generated image

Fear of China's self-reliance in semiconductor equipment has hit U.S. tech stocks. Only six memory-related stocks, including Nvidia (NVDA) and SK Hynix, saw $541 billion evaporate.

According to investment media Benzinga on July 28 (local time), more than $1 trillion in market capitalization disappeared from the U.S. stock market in a single day. Nvidia's decline was the largest, at approximately $300 billion. SK Hynix lost $95 billion, and Micron Technology (MU) lost $82 billion.

SanDisk (SNDK) saw its market capitalization decrease by $26 billion. Western Digital (WDC) and Seagate Technology (STX) decreased by $21 billion and $17 billion, respectively. The losses of these six companies accounted for more than half of the total decline in the U.S. stock market.

The sell-off began with news that a Chinese state-owned manufacturer had begun mass production of domestically produced deep ultraviolet (DUV) lithography equipment. Concerns spread that if Chinese semiconductor companies expand their production capacity with their own equipment, memory supply could increase and sales prices could fall.

The impact spread to semiconductor ETFs. The VanEck Semiconductor ETF (SMH) fell 2.25% and then slid an additional 0.65% after hours. The iShares Semiconductor ETF (SOXX) fell 2.05%, and the Direxion Daily Semiconductor Bull 3X ETF (SOXL) plummeted 6.33%. SOXL also fell an additional 2.26% after hours.

Counterpoint Research analyst MS Hwang analyzed that China's technological advancements would have a greater impact on general-purpose DRAM and NAND than on high-bandwidth memory. Chinese companies are expected to begin HBM3 production in the first half of 2027. During the same period, Micron, SK Hynix, and Samsung Electronics are expected to maintain their technological lead by transitioning to HBM4.

[Article Key Summary]

-Amid concerns over China's mass production of domestically produced semiconductor equipment, the market capitalization of the U.S. stock market decreased by more than $1 trillion in a single day.

-The total market capitalization decrease for six memory-related stocks, including Nvidia and SK Hynix, amounted to $541 billion.

-China's pursuit is focused on general-purpose DRAM and NAND, and the technology gap in high-bandwidth memory is expected to be maintained for some time.

*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*