US-listed semiconductor stocks edged lower in Wednesday trading, extending recent losses despite positive developments from major Asian chipmakers. Intel shares dropped 4.68% to $92.16, while Sandisk slipped 4.5% to $1,552.66. Western Digital fell 5.16% to $470.58, AMD traded 3.97% lower at $465.16 and Micron Technology dipped 1.98% to $922.11. In contrast, SK Hynix ADR gained 2.9% to $160.14, reflecting investor optimism about the company's massive buyback announcement. The broader US market remained mixed, with Dow Jones Industrial Average rising 0.52% to $53,623.22 and S&P 500 gaining 0.37% at $7,720.46, while Nasdaq-100 futures dipped 0.24% to $29,420.23. The latest sell-off comes as the Nasdaq 100 declined 1.5%, reflecting broader market concerns about technology valuations amid rising interest rate expectations.
SK Hynix announced a massive share buyback program worth approximately $28.61 billion, allocating at least 50% of its free cash flow generated between 2025 and 2027 towards shareholder returns. The South Korean chipmaker plans to buy back and cancel 40 trillion won worth of treasury shares, with additional shareholder returns to be provided through dividends. The company has enhanced its buyback program by announcing it will purchase up to 24 million treasury shares from August 20 to November 19 and cancel them. SK Hynix has also boosted its shareholder return pledge to more than 50% of free cash flow, up from a previous target of within 50%. The announcement came after SK Hynix shares had fallen around 10% during Korean trading amid a broader sell-off in Asian technology stocks. SK Hynix ADR moved higher in US trading, rising 2.9%, while the stock pared some of its losses following the buyback announcement, although it remained under pressure.
Samsung Electronics plans to invest around $158 million to establish an HVAC production line at its Gwangju operations site in South Korea. The company seeks to tap into the rapidly expanding HVAC market, particularly demand for advanced cooling solutions for AI data centres. This investment comes as the semiconductor space has continued to face volatility since June with cycles of profit-taking and massive sell-offs, as concerns grow over heavy artificial intelligence spending by big tech companies and pressures from new domestic chip production. The latest drop comes after SK Hynix announced it will buy back up to 24 million treasury shares from August 20 to November 19 and cancel them, with further details expected alongside the company's third-quarter earnings.
Treasury yields remained elevated across global markets on Tuesday, with the 10-year US Treasury yield hovering near its highest levels since early 2025, creating sustained pressure on technology stocks. Oil prices climbed more than 1% on Wednesday amid reports that Iran was considering attacks on US targets in Europe, adding to geopolitical concerns in energy markets. Persistently elevated crude prices have pushed government bond yields higher across several markets, with investors increasingly concerned that higher energy costs could fuel inflation. President Donald Trump insisted there were no talks ongoing with Iran, leaving the simmering conflict in the Middle East and control of the Strait of Hormuz stuck in limbo. Florian Ielpo at Lombard Odier Investment Managers noted that "The investment hurdle rate is rising again through a combination of oil, fiscal supply and long-end term premium rather than a renewed acceleration in short-rate expectations." Elias Haddad at Brown Brothers Harriman & Co emphasized that "The recent bond selloff appears to reflect investors demanding greater compensation for fiscal, geopolitical and policy uncertainty."
AI optimism lifted tech stocks as investors responded positively to developments from major AI firms. Anthropic forecasted $190-$200 billion revenue by 2028, providing a significant boost to AI sector confidence. Amazon, Alphabet, and chipmakers saw premarket gains amid strong AI-driven earnings expectations. This dramatic move has helped drive the broader AI sector rally, with the NASDAQ (+0.81%) and Philly semiconductor index (+0.46%) also advancing alongside the Magnificent 7's recovery. The AI capital spending concerns that Lee previously cited as a risk have faded as results came in, with many institutional clients still believing the AI trade is stretched or that earnings have peaked. Technology and semiconductor stocks were providing the biggest support to the Nasdaq, with Micron Technology shares rising more than 3%, while Broadcom and Nvidia also traded higher.
