Sharp declines in memory chip stocks, KOSPI index plunges

The announcement by Chinese chip giant CXMT of a new DRAM technology has led to sharp declines in chip stocks and South Korea's KOSPI index, which fell by up to 7%. Samsung and SK Hynix shares are leading the declines amid fears of growing competition.

The announcement by Chinese chip giant CXMT of a breakthrough in DRAM memory technology has led to sharp declines in Asian markets. South Korea's KOSPI index fell by up to 7%, and Japan's Nikkei index dropped by more than 2%. The trigger is a notice about a new component architecture known as 4F², which allows for greater information compression in a smaller silicon area while reducing production costs. According to published data, memory density could increase by up to 50%. The company plans to launch chips for the server and artificial intelligence market as early as late 2026. Micron's stock lost more than 3% in Wall Street trading and fell an additional 3% after hours, while SanDisk's stock lost nearly 10% cumulatively. SK Hynix's stock fell by about 7% cumulatively. Samsung and SK Hynix together account for more than half of the KOSPI index's weight, amplifying volatility. The gains in chip stocks contributed to a surge of nearly 70% in the Korean index over the past year.