A rebound in U.S. semiconductor stocks on Monday quickly ran out of steam as Asian markets took a sharp turn lower on Tuesday, raising fresh doubts about whether the artificial intelligence chip boom can keep delivering gains for investors.
Samsung Electronics saw its shares plunge nearly 7% on Tuesday, a surprising reaction given the South Korean tech giant had just reported a staggering 19-fold increase in second-quarter operating profit. Rival chipmaker SK Hynix also fell sharply, pulling South Korea’s chip-heavy KOSPI stock index down roughly 5%.
The Monday rally in U.S. chip stocks appeared to be fueled by news that Broadcom had extended a deal with Apple to supply the iPhone maker with custom-built chips through 2031. That positive sentiment lifted both the S&P 500 and the Nasdaq to higher closes. By Tuesday morning, however, Nasdaq futures were down more than 1% ahead of the opening bell, reflecting the turbulence overseas.
Analysts note that the Tuesday selloff in Asian tech stocks could be a signal that investors already have the benefits of surging chip demand baked into current prices. It’s also worth noting the dramatic run-up these stocks have already seen — Samsung’s share price had more than doubled so far this year, while SK Hynix had more than tripled.
In other technology news, Microsoft shares slipped nearly 1% on Monday after the company announced it would be cutting approximately 4,800 jobs as part of a restructuring of its gaming division. The announcement came after the company’s stock had already fallen roughly 20% during the first six months of 2026.
On the currency front, Japan’s yen edged slightly stronger on Tuesday but remained near 40-year lows, hovering around 162 yen per dollar. Traders continued to watch closely for any sign that Japanese authorities might step in to support the currency.
Oil markets moved higher following reports that Iran launched missiles at commercial vessels in the Strait of Hormuz on Monday. Brent crude was trading at close to $73 per barrel in the wake of those reports.
On the diplomatic stage, the NATO summit opened Tuesday in Ankara, Turkey, with European defense spending expected to dominate discussions. Leaders are under pressure to show how they plan to meet higher NATO spending targets that President Donald Trump has been pushing for. Several NATO member nations began announcing multi-billion dollar arms agreements at the summit’s opening.
NATO Secretary General Mark Rutte said Monday that European nations had made what he called “staggering” increases in defense spending, driven both by fears of Russia following Moscow’s 2022 invasion of Ukraine and by what he described as President Trump’s “forceful” push for greater contributions.
Also drawing attention is a planned meeting on the sidelines of the summit Wednesday between President Trump and Ukrainian President Volodymyr Zelenskiy. Trump on Monday again suggested that a resolution to the war in Ukraine could be within reach.
Key events to watch Tuesday include the release of the U.S. May trade balance at 8:30 a.m. EDT, a 3-year Treasury note auction at 1 p.m. EDT, and SpaceX’s addition to the Nasdaq 100 index.
