On Thursday, global stock markets mostly saw declines, driven by extended losses in technology shares and mounting tensions between the United States and Iran, which weighed heavily on investor sentiment. Concurrently, oil prices hovered near their highest levels in a month, as concerns about stability in the Middle East continued to loom.
The previous day’s gains on Wall Street failed to carry over to Asian and European markets. South Korea’s Kospi index experienced a steep drop of over 6%, with semiconductor company SK hynix experiencing a significant fall of more than 11%. This decline stemmed from investor apprehension that the earlier surge in semiconductor stocks, fueled by artificial intelligence advancements, may be tapering off. The sustainability of high valuations for many tech firms has come under scrutiny, leading to a broader retreat in memory-chip and semiconductor stocks.
Despite these challenges, Taiwan Semiconductor Manufacturing Company (TSMC) managed to report a record profit for the quarter, with net income jumping over 77% in the second quarter. This surge was attributed to robust demand for AI hardware. Furthermore, TSMC revealed plans to invest an additional $100 billion in expanding its manufacturing capabilities in Arizona.
In contrast to the general market trend, Hong Kong’s stock market rose by more than 1%, buoyed by advances in Chinese semiconductor companies. Meanwhile, in the United States, major indexes ended Wednesday on a positive note, driven by gains in large technology firms. Investor sentiment was further bolstered by a 0.3% drop in US producer prices in June, largely due to reduced energy costs and growing expectations that the Federal Reserve might refrain from increasing interest rates in the near term. However, experts cautioned that the intensifying US-Iran tensions could lead to heightened market volatility.
In corporate developments, the German food-delivery enterprise Delivery Hero reached an agreement to be acquired by the ride-hailing behemoth Uber. The deal, valued at €12.7 billion ($14.6 billion), led to a rise in Delivery Hero’s shares during trading in Frankfurt.