SK Hynix, Samsung Electronics fall 7% as Asian equities decline, chip sell-off spreads

Published Wed, Aug 19, 2026 · 09:18 AM — Updated Wed, Aug 19, 2026 · 02:21 PM

ASIAN stocks dropped as a semiconductor sell-off deepened, with investors retreating from one of the year’s hottest trades amid elevated bond yields and geopolitical uncertainty. Treasuries stabilised following recent losses.

MSCI’s Asia Pacific equities benchmark slid 2 per cent, with South Korean shares dropping 5.5 per cent.

Chip bellwethers Samsung Electronics and SK Hynix both declined over 7 per cent, tracking a semiconductor sell-off on Wall Street. Kioxia plunged 9 per cent in Tokyo.

Among the main market moves, S&P 500 futures were little changed as of 11.59 am Tokyo time.

Japan’s Topix fell 2.7 per cent, Australia’s S&P/ASX 200 fell 0.4 per cent, Hong Kong’s Hang Seng rose 0.1 per cent and The Shanghai Composite fell 1.7 per cent.

Treasuries steadied following a global bond sell-off that had pushed 10-year US yields close to their highest levels since early 2025 and 30-year yields to levels last seen in 2007.

The yield on 10-year Treasuries declined one basis point to 4.69 per cent, while bonds rose in Australia and New Zealand.

Elsewhere, oil climbed for a fourth day, with no sign of progress towards resolving the US-Iran war after almost six months of conflict. Brent traded above US$91 a barrel after gaining 4.5 per cent over the previous three sessions.

“With the outlook for the Middle East remaining uncertain and yields staying elevated, markets are likely to remain in risk-off mode today,” said Kazunori Tatebe, chief strategist at Daiwa Asset Management.

“Higher yields will increase borrowing costs for hyperscalers, raising questions about the outlook for capital spending and the potential impact on artificial intelligence infrastructure companies.”

Technology stocks, seen as a long-term growth bet, came under pressure as bond yields hovered near multi-decade highs amid persistent inflation, heavy government spending and a flood of debt issuance.

Geopolitical turmoil added to the strain by raising the risk of energy-driven supply shocks that could keep inflation and borrowing costs elevated for longer.

The chip sector remained in focus after the Philadelphia Semiconductor Index slid 5 per cent on Tuesday, its biggest drop since late July.

An Asian gauge of chip-related stocks retreated 3.1 per cent, with Taiwan Semiconductor Manufacturing and Renesas Electronics among the decliners.

The threat of higher borrowing costs is adding to market worries amid ongoing uncertainty over the Iran war.

While the long-term AI growth story is still intact, “higher rates and geopolitical risk are making investors less willing to pay a premium for that growth”, said Jung In-yun, chief executive officer at Fibonacci Asset Management Global.

In other corners of the market, Unitree Robotics shares rose 629 per cent in its Shanghai trading debut after raising 6.1 billion yuan (US$904 million) in an initial public offering that will make it the first publicly traded humanoid robot maker in mainland China.

The Canadian dollar strengthened after the Trump administration agreed to delay 50 per cent tariffs on billions of dollars of Canadian products for three days following high-stakes negotiations in Washington. 

Gold steadied around US$4,340 an ounce after its biggest drop in almost a month, as a bond sell-off and deadlock over the Strait of Hormuz clouded the outlook for the precious metal.

The US 30-year yield was little changed at 5.29 per cent, after climbing as high as 5.34 per cent in the prior session.

“There is a mini wave of bond futures buying across Japanese government bonds, Treasuries and in Australia, which looks like a knee-jerk haven bid as stocks slide in South Korea and Japan. The shift is being helped by positioning, which became heavily stretched to bond shorts recently,” said Mark Cranfield, markets live strategist at Bloomberg.

Widening credit spreads, rising interest rates and a surge in supply all contributed to a softer high-grade funding backdrop on Tuesday, prompting at least seven issuers to decide against announcing bond deals to the market.

Attention later on Wednesday will be on the minutes from the US Federal Reserve’s latest meeting, which may offer clues on policymakers’ thinking at a time when chairman Kevin Warsh has scaled back communications.

Meanwhile, Middle East tensions intensified after the United Arab Emirates said two ballistic missiles fired from Iran towards the country fell into the sea, marking the Islamic Republic’s first known attack on the Gulf nation since May as the wider conflict dragged on. 

“The surge in oil prices caused by growing uncertainty over Iran continues to dampen investor sentiment,” said Tomo Kinoshita, global market strategist at Invesco Asset Management Japan.

“Combined with rising inflation concerns, this has created broad headwinds for equity markets, negatively affecting a wide range of sectors and stocks.” BLOOMBERG