End of Day Report – Tuesday 13 October: ASX Flat as Value Rises, Resources and Tech Hammered -

The ASX 200 has finished the day flat, but there was a lot more going on underneath the surface.

That following a very quiet day on Wall Street.

With the bond market closed, the volumes were down, and the S&P 500 also finished flat.

Today, though, we saw a flight to safety as a sell-off in South Korean chip stocks saw Nasdaq futures drift lower.

S&P 500 futures currently down 0.1%, but Nasdaq futures off 0.6, and the KOSPI down at 6.5% at the time of recording.

The South Korean index is heavily concentrated in memory names, most of that coming from SK Hynix and Samsung Electronics, and those both coming under pressure today after news of the Chinese memory competitor CXMT released a higher density memory chip.

You may recall back in July when the company listed, it also triggered a sell-off in global semiconductor shares, and so we might be seeing a repeat.

The semiconductor space also under pressure after Broadcom CEO Hock Tan, Broadcom is the second-largest semiconductor stock in the world after Nvidia, said that capital may be the next major constraint to the great AI build-out.

Rising bond yields globally have dramatically increased the global cost of borrowing, and every so often we do get a catalyst like today, which reminds everyone how fragile AI sentiment is and resurfaces all the AI return on investment concerns.

To make matters worse, there was also news of Microsoft releasing an in-house chip to reduce dependence on Nvidia.

All of that resulted in anything AI-related being sold off today.

Hardest hit was the Global X Semiconductor ETF.

That finished down at 4.5%, and most of the Australian data center exposures.

We had NEXTDC off 7.6%, Macquarie Technology down 7.7%, and SKS Technologies off 20.5% today.

Absolutely hammered.