# Semiconductor Selloff Spreads From Wall Street to Asia, Nikkei Falls More Than 4 Percent

SoftBank lost about 9 percent and memory maker Kioxia nearly 16 percent as investors pulled back from the artificial-intelligence trade that led markets higher this year.

- Published: 2026-07-17T05:11:42.606Z
- Canonical: https://polylog.news/2026-07-17/semiconductor-selloff-spreads-from-wall-street-to-asia-nikke
- Publisher: Polylog (Global desk)
- Section: markets
- Sources: [Financial Times](https://www.ft.com/content/c92a5a36-55a0-4d04-b84c-d1705976987b?syn-25a6b1a6=1), [Globes (Hebrew)](https://www.globes.co.il/news/article.aspx?did=1001549722#utm_source=RSS), [CNBC](https://www.cnbc.com/2026/07/17/softbank-chip-stocks-asia-wall-street-ai-rout.html)

A retreat from the companies that led global equities higher through the first half of 2026 accelerated on Friday. A decline in United States chip and memory shares spread into Asian trading and pulled major benchmarks sharply lower.

Japan's Nikkei 225 fell as much as 4 percent, according to [reporting from Tokyo](https://www.cnbc.com/2026/07/17/softbank-chip-stocks-asia-wall-street-ai-rout.html). The technology investor SoftBank dropped around 9 percent and the chip-equipment maker Advantest fell by a similar margin. The memory manufacturer Kioxia declined close to 16 percent in a single session, extending a slide that has removed roughly 44 percent of its value in a month. The Israeli financial outlet Globes reported that the [negative sentiment affecting chip shares in the United States](https://www.globes.co.il/news/article.aspx?did=1001549722#utm_source=RSS) reached exchanges across the East, with South Korea's market closed for a local holiday.

The Financial Times described the move as [investors pulling away from the shares that had led markets](https://www.ft.com/content/c92a5a36-55a0-4d04-b84c-d1705976987b?syn-25a6b1a6=1) higher this year, a rotation out of richly valued stocks rather than a broad economic alarm. Netflix added to the caution, falling more than 8 percent in after-hours trading on Thursday. Its revenue and earnings came in roughly in line with estimates, but its forecast for the current quarter disappointed. Taiwan Semiconductor Manufacturing's outlook, delivered a day earlier, failed to reassure investors who have grown more skeptical about how quickly artificial-intelligence spending will convert into profit.

The pullback matters because a handful of chip and platform companies now account for an outsized share of index gains, so a repricing of their earnings assumptions moves entire markets. From a sound-money view, the episode illustrates how years of cheap credit concentrate capital into a narrow set of assets whose valuations depend on continued expectations of abundant liquidity. When those expectations soften, the correction is fast and broad.

## What this means

The AI trade now supports much of the gain in global equity indices, so a derating of chipmakers and memory producers passes directly into pension and index-fund returns worldwide, not just into technology sectors. Exposed are leveraged technology investors like SoftBank, memory makers whose margins swing with the capital-spending cycle, and any index heavily weighted toward a few large stocks. The channel is valuation multiples compressing as investors demand proof that AI capital spending earns a return.

## What to watch

- Whether US megacap technology earnings due over the next two weeks confirm or ease the profit doubts, since guidance will decide if this is a rotation or the start of a deeper derating.
- Kioxia and other memory makers' order books, which show whether AI-driven hardware demand is genuinely slowing or merely repricing.