Semiconductors fell over 10% this week and nearly 19% this month, and South Korea’s market suffered its steepest single-day fall of the year on 13 July. The Kospi closed down 8.95%, having been down as much as 9.26% intraday after brokers questioned SK Hynix earnings outlook revived fears that AI memory chip demand is slowing. The rout was worsened by single-stock leveraged funds tracking Samsung and SK Hynix, which were forced to sell mechanically as the shares fell, deepening the decline. This matters because it shows how concentrated recent market gains have been: when the AI story wobbles, it’s a small group of stocks doing almost all the damage, while the rest of the market holds up \u2014 and it shows how leveraged products can turn an ordinary correction into something much more violent.<\/p>\n\n\n\n
2. Chinese AI firms are closing the gap on US labs, and doing it far more cheaply.<\/strong> 3. China’s economy is slowing by more than officials wanted.<\/strong> 4. The Middle East conflict escalated again, and oil, gas and petrol prices jumped hard.<\/strong> Semiconductors, and South Korea as a proxy for it. This is the single area that will tell us whether this week was a healthy pullback in an extraordinary run \u2014 semiconductors are still up 73% this year and nearly 200% over three years \u2014 or the start of a genuine unwind in AI-linked leadership. If the selling continues, it confirms this week wasn’t a one-off; if it stabilises, this looks more like a shakeout of overcrowded, leveraged positioning rather than a real change in the AI story.<\/p>\n\n\n\n This week reinforces the case for diversification within equities rather than a wholesale shift out of them \u2014 the damage was heavily concentrated in AI and semiconductor names, while value and smaller companies were largely untouched. On energy, the sharp rise in oil and gas prices tied to the Middle East conflict is a reminder that this remains a live risk worth holding some protection against, whether through energy exposure. Investors should also be alert to how much of recent index gains have depended on a small number of AI-related stocks, since that concentration is exactly what made this week’s reversal look so much larger than the headline market indices suggest.<\/p>\n\n\n\n <\/p>\n\n\n\n <\/p>\n","protected":false},"excerpt":{"rendered":" MARKETS IN BRIEF This was a week where one story dominated: the AI trade came off the boil, hard. Semiconductor and South Korean equities fell sharply while the broader market barely moved, oil and gas jumped on renewed Middle East conflict, and gold kept sliding despite the turmoil elsewhere. The mood is best described as […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-895","post","type-post","status-publish","format-standard","hentry","category-uncategorized"],"yoast_head":"\n
Chinese developers Moonshot and DeepSeek released models that reportedly match or beat leading US models, with DeepSeek said to cost a fraction of what US competitors charge for similar tasks. This matters because it undermines the idea that today’s leading AI companies have a lasting edge. If AI capability becomes widely available and cheap, the companies that make the most money may be the ones with other advantages, such as owning the hardware people already use or the power needed to run these systems, rather than the AI software itself.<\/p>\n\n\n\n
Second-quarter growth came in at 4.3%, below the government’s own target range of 4.5% to 5%, and the weakest reading since late 2022. Property investment fell 18% in the first half of the year as part of a broader 5.7% decline in fixed-asset investment. On a positive note, industrial production accelerated to a three-month high of 5.3% in June, while retail sales unexpectedly rebounded to 1%. Onshore Chinese equities were broadly flat-to-slightly lower, while Hong Kong-listed shares outperformed. This signalled investors are not surprised and markets are looking beyond the slowdown.<\/p>\n\n\n\n
The US struck Iranian missile sites after an interim peace deal broke down, reviving fears that Iran could disrupt shipping through the Strait of Hormuz, a route that carries around a fifth of the world’s oil and gas. This matters because it directly threatens global energy supply, and the price moves this week \u2014 oil, gas and petrol all up double digits over the week \u2014 suggest markets are taking the threat seriously, not dismissing it as noise.<\/p>\n\n\n\n![\"\"](\"https:\/\/inmyopinion.com.sg\/wp-content\/uploads\/2026\/07\/IMG_0006.png\")
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