Shares of ARM Holdings Ltd (ARM) plunged 9.01% during intraday trading on Thursday, as the semiconductor sector faced a broad sell-off fueled by disappointing earnings reports and concerns over the AI frenzy.
The decline in ARM's stock price was part of a larger downward trend in the semiconductor industry, with major players like Micron Technology, Nvidia, AMD, Broadcom, and Intel also experiencing significant losses. The Philadelphia SE Semiconductor Index tumbled 5.4% on Wednesday, closing 13.5% below its all-time closing high and entering correction territory.
The sell-off was exacerbated by jitters surrounding the AI frenzy, as investors grew cautious about the lofty valuations of AI-linked stocks. Asian markets also witnessed sharp declines, with South Korea's SK Hynix falling 8.9% despite posting its highest quarterly profit since 2018. In Japan, Renesas Electronics slumped 13.6% after reporting a 29% decline in net profit for the six months to June.
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