LONDON, July 7 Global stocks fell on Tuesday as technology shares slid despite blockbuster results from Samsung Electronics, with investors remaining concerned about the sustainability of the AI-driven rally, while oil prices rose on renewed Middle East tensions.
Samsung Electronics forecast a 19-fold jump in April-June operating profit to 89.4 trillion won ($58.4 billion), marking a third straight quarter of record operating profit for the world’s largest memory chipmaker
Rather than reassuring investors, the results triggered heavy selling in Samsung and rival SK Hynix shares, weighing on South Korea’s Kospi and other technology-heavy Asian markets. Investors have increasingly questioned whether profit growth linked to artificial intelligence can be sustained if supply bottlenecks in key components such as memory chips ease. “This is a record for Samsung, but rather than placate the markets, these strong results have led to fears that the AI chip sales boom cannot be sustained,” Kathleen Brooks, research director at XTB, said. Morgan Stanley said in a note dated Monday that recent weakness in U.S. semiconductor stocks signalled a broadening of market gains, with investors likely to turn towards AI hyperscalers as well as consumer discretionary, transport and biotechnology shares.
SK Hynix is due to enter the Nasdaq this week in a $28 billion listing, one of the world’s largest new share sales, as the chipmaker seeks to capitalise on the AI boom. Its shares, which were up as much as 350% this year at their peak two weeks ago, have since fallen about 30% amid a broader sell-off in global chip stocks. In Europe, where exposure to volatile AI-linked stocks is more limited, the STOXX 600 rose 0.1%, supported by gains in oil and gas shares as crude prices edged higher amid signs that U.S.-Iran peace talks were losing momentum.