More than $1 trillion was wiped from U.S. stocks on Monday, with over half of the losses concentrated in just six memory-related names as investors dumped the sector on fears that China could expand domestic chip production.
Six Memory Stocks Lose $541 Billion in Value
NVIDIA Corp (NASDAQ:NVDA) led the decline, wiping out roughly $300 billion in market value, followed by SK Hynix Inc (NASDAQ:SKHY) with $95 billion, Micron Technology Inc (NASDAQ:MU) with $82 billion, SanDisk Corp (NASDAQ:SNDK) with $26 billion, Western Digital Corp (NASDAQ:WDC) with $21 billion and Seagate Technology Holdings plc (NASDAQ:STX with $17 billion, according to data shared by market commentator Bull Theory on X.
Together, the six companies erased approximately $541 billion in market capitalization during Monday’s selloff.
The selloff followed a report by The Information that a state-backed Chinese manufacturer had entered mass production of domestically developed DUV lithography systems.
The development is expected to help Chinese chipmakers expand manufacturing capacity using homegrown equipment, fueling concerns over future memory-chip supply and pricing.
ETFs to Watch
The selloff also weighed on semiconductor exchange-traded funds with significant exposure to AI and memory stocks.
The VanEck Semiconductor ETF (NASDAQ:SMH), which has $67.50 billion in assets under management and an expense ratio of 0.35%, has returned 46.95% so far this year and 88.24% over the past year. On Monday, it lost 2.25% at $548.55 and declined another 0.65% in after-hours trading.
The iShares Semiconductor ETF (NASDAQ:SOXX) has $45.55 billion in assets and charges an expense ratio of 0.34%. Year-to-date, the ETF gained 64.57% and 110.06% over the past year. It fell 2.05% to $516.23 and lost further 0.81% in extended trading.
Direxion Daily Semiconductor Bull 3X ETF (NYSE:SOXL) has $19.94 billion in assets and charges an expense ratio of 0.75% lost 6.33% on Monday and another 2.26% in after-hours trading. Year-to-date, SOXL has returned 171.27% and 376.75% in the past year.
The SPDR S&P Semiconductor ETF (NYSE:XSD) ended Monday down 0.30% before recovering 1.44% in after-hours trading, while the Invesco Dynamic Semiconductors ETF (NYSE:PSI) fell 3.70% and declined another 1.03% after the bell.
Analyst Says HBM Lead Remains Intact
Counterpoint Research analyst MS Hwang told Benzinga that China’s progress is likely to have a greater impact on commodity DRAM and NAND than AI-focused high-bandwidth memory (HBM), where leading manufacturers still hold a significant technological edge.
He expects Chinese companies to begin producing HBM3 in the first half of 2027, by which time Micron, SK Hynix and Samsung Electronics are expected to have transitioned to HBM4.
Price Action: Shares of NVIDIA closed 4.99% lower on Monday at $196.51 and fell further 0.19% in extended trading.
Benzinga edge rankings indicate NVDA has a Momentum score in the 64th percentile and a Growth score in the 98th percentile.
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
Photo Courtesy: William Potter on Shutterstock.com
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