Asian Chip Stocks Slide as China's CXMT Debut Fuels Competition Concerns

Asian semiconductor stocks declined as investors weighed intensifying competition from China following the blockbuster stock market debut of memory chipmaker CXMT Corp., Yuvraj Malik reported for Reuters.

Investors are monitoring semiconductor stocks following CXMT's blockbuster Shanghai market debut. [Photo: Foresee / CXMT]

CXMT's strong market debut has become another sign of growing optimism surrounding China's technology sector and could reshape competition in the global memory chip industry.

Nomura expects the company's stock to rise 1,239 percent from its initial public offering (IPO) price.

Meanwhile, U.S. memory and semiconductor companies have come under heavy selling pressure. Micron Technology (MU) has fallen 22 percent in July, while the Roundhill Memory ETF and the iShares Semiconductor ETF have declined 29 percent and 19.4 percent, respectively.

CXMT raised 57.92 billion yuan (US$8.6 billion) in its Shanghai IPO, making it Asia's largest stock market listing this year.

The stock surged 466 percent on its trading debut, lifting the company's market capitalization to about US$487 billion, making it the most valuable company listed on mainland China's exchanges and surpassing Intel's market value of US$462.38 billion.

Although such sharp gains are not unprecedented, the company's strong debut underscores growing confidence in China's semiconductor industry and signals a potentially significant shift in the global memory market.

Memory prices have risen sharply in recent years as demand from artificial intelligence data centers outpaced supply.

The resulting shortage enabled memory manufacturers to raise prices and secure long-term customer contracts, boosting revenues and share prices for companies including Micron, SanDisk, Samsung Electronics, and SK Hynix.