ARM Holdings plc tumbled 10.1% Monday as a collapse in South Korea's chip-heavy KOSPI index and a Bank of America research note warning of up to three additional Federal Reserve rate hikes this year sent the global semiconductor sector into its sharpest one-day rout in months. The S&P 500 fell 1.44%, the Nasdaq Composite slid 2.21%, and the SOXX semiconductor ETF cratered 7.88%, erasing an estimated $1.4 trillion in market value from the AI chip universe in a single session, while enterprise software names staged a quiet counterrally.
Today's biggest movers
| Ticker | Close | Day | 1mo | YTD |
|---|---|---|---|---|
| $NOW | $95.94 | +3.15% | -6.06% | -34.93% |
| $NET | $224.94 | +3.00% | +4.06% | +14.75% |
| $CRM | $153.42 | +2.20% | -14.80% | -39.51% |
| $DELL | $427.78 | +2.17% | +44.92% | +234.73% |
| $MSFT | $373.94 | +1.80% | -10.66% | -20.93% |
| $ARM | $366.39 | -10.14% | +19.54% | +219.35% |
| $LRCX | $371.33 | -9.33% | +21.61% | +100.65% |
| $AMAT | $585.88 | -8.48% | +35.57% | +117.90% |
| $ASML | $1,778.46 | -7.82% | +8.91% | +52.82% |
| $TSM | $436.39 | -6.69% | +7.88% | +36.54% |
ARM Holdings slides 10.1% as valuation stretch and South Korea shock collide
ARM Holdings plc (NASDAQ: ARM) suffered the deepest single-session loss in the AI chip universe Monday, falling 10.1% to close at $366.39 after a torrent of converging pressures overwhelmed the stock's year-to-date momentum of more than 219%. The selling began overnight as South Korea's KOSPI index plunged roughly 10%, its steepest intraday decline in months, with Samsung Electronics and SK Hynix both tumbling more than 12% and triggering circuit breakers, sending reverberations across every major chip design and equipment name globally.
ARM's vulnerability was compounded by a downgrade issued the previous week by New Street Research, which cut the stock from Buy to Neutral and warned that the trailing price-to-earnings ratio had stretched past 480x following the stock's 235% year-to-date rally. Consecutive open-market share disposals by senior ARM executives, including its Chief Commercial Officer, Chief Accounting Officer, and Chief People Officer, across late May and June have also weighed on sentiment. Analyst consensus targets from Bernstein and Mizuho remain constructive on the name, but the average Street price target sits near $282, a significant discount to Monday's close.
Chip equipment stocks record some of the session's deepest losses
Lam Research Corp. (NASDAQ: LRCX) fell 9.33% to $371.33 and Applied Materials Inc. (NASDAQ: AMAT) dropped 8.48% to $585.88, as the South Korea shock catalyzed a sharp repricing of chip equipment makers whose near-term order books are closely linked to Samsung and SK Hynix capital spending cycles. AMAT's decline drew additional scrutiny given recent insider selling: Chief Executive Gary Dickerson liquidated roughly $42.5 million in shares in mid-June, while Chief Technology Officer Omkaram Nalamasu sold approximately $14.4 million, moves the market interpreted as caution from company leadership on valuation. Despite the session's losses, the S&P Global analyst consensus on AMAT remains Buy, with an average 12-month price target of $524.78. Wells Fargo recently raised its target on LRCX to $450 from $365, while Oppenheimer lifted its target to $400 from $330.
ASML Holding N.V. (NASDAQ: ASML), the Dutch monopoly supplier of extreme ultraviolet lithography machines, gave back 7.82% to close at $1,778.46. Market reports indicate Taiwan Semiconductor Manufacturing Co. has been signaling delays in deploying ASML's next-generation High-NA EUV systems, with clients prioritizing advanced packaging alternatives ahead of a full High-NA volume ramp. Bank of America reiterated a Buy rating and raised its ASML price target to $2,345 from $2,268, representing more than 30% upside from Monday's close.