Hong Kong AI stocks plunge 14% as Asia tech rout deepens

Hong Kong-listed artificial intelligence stocks suffered their worst session in months, tracking a regional technology rout that erased billions in market value.

Yangtze Optical Fiber and Cable (长飞光纤光缆) plunged more than 14% on June 26, leading a broad selloff in Hong Kong AI stocks that wiped out gains from earlier this week.

"The strong Micron print produced a powerful upside chase one day, and a new concern around memory costs and the durability of AI demand reversed it violently the next," Stephen Innes, managing partner at SPI Asset Management, said.

Tianshu Zhixin (天数智芯) dropped 13%, Zhipu (智谱) fell 11%, and MINIMAX-W slid more than 10%. The Hang Seng Index lost 1.7% to 22,684.76. The selloff extended across Asia: Tokyo's Nikkei 225 shed 4.5% to 69,127, Seoul's Kospi plunged 6.8% to 8,323, and Taiwan's Taiex gave up 3.6%. SoftBank Group Corp. lost 13.4% in Tokyo, while Samsung Electronics dropped 7% and SK Hynix fell 6.6% in Seoul. Australia's S&P/ASX 200 was an outlier, gaining 0.2%.

The reversal shows how quickly AI exuberance can unwind in a market where valuations have stretched to extreme levels. Qualcomm's investor day and Micron's blockbuster earnings had fueled a rally earlier in the week, but profit-taking and concerns about the durability of AI-driven demand triggered a violent swing lower. The Shanghai Composite Index slipped 1.4% to 4,062.28, while the dollar weakened to 161.64 yen. Brent crude fell 1.8% to $74.13 a barrel, and West Texas Intermediate lost 2% to $70.46.

The selloff followed a mixed U.S. session where the S&P 500 finished nearly unchanged and the Nasdaq composite fell 0.5%. Apple dropped 6.1% after raising prices on MacBooks, iPads and other devices, citing rising memory and storage chip costs driven by the AI boom. Micron Technology had jumped 15.7% after reporting profit and revenue that beat analyst estimates, but the relief proved short-lived as traders locked in gains from a 267% surge in the stock year-to-date.

The broader question for investors is whether the AI infrastructure buildout can sustain its momentum. Qualcomm unveiled its data center chip roadmap at its investor day, while Blackstone announced plans to invest $30 billion in AI data centers in Japan. Yet the violent price swings suggest the market is struggling to price the long-term opportunity against near-term valuation risk.

This article is for informational purposes only and does not constitute investment advice.