Asian markets plunged on July 28, 2026, as concerns over the sustainability of AI-driven chip investments intensified. A sharp decline in semiconductor stocks followed reports of a growing circular funding trend, where companies reinvest in each other’s products, raising questions about true market demand. Nvidia's $750 billion in recent deals amplified these fears. Simultaneously, news emerged that China had begun mass production of immersion DUV lithography machines, potentially undermining the global dominance of Western chipmakers and triggering widespread investor anxiety.
The KOSPI dropped over 10%, with other regional indices also suffering steep losses. US futures signaled further declines, particularly for tech-heavy benchmarks like the Nasdaq. Analysts on Bloomberg’s Asia Trade highlighted the risks posed by supply chain fragmentation and shifting investment dynamics. Meanwhile, oil prices dipped amid speculation of a US-Iran agreement, though the focus remained firmly on the tech sector’s downturn. Investors await official confirmation from Chinese authorities regarding the DUV developments.