Samsung Electro-Mechanics shares fell more than 14% in early trading due to concerns over a slowdown in AI investments in the United States. The potential for stricter regulations on data centers following the U.S. midterm elections has raised alarms about reduced investment in AI infrastructure, impacting semiconductor stocks and related sectors.
As of 9:13 a.m. on November 6, Samsung Electro-Mechanics was trading at 809,000 won, down 135,000 won (14.30%) from the previous trading day. The stock dipped as low as 796,000 won earlier in the session.
With the Democratic Party securing control of both the House and Senate in the midterm elections, discussions about tightening regulations on data centers have intensified. This has led to growing concerns about reduced infrastructure investments and a slowdown in orders for memory semiconductors. Even if the AI industry continues to grow, delays in data center construction could lead to lower-than-expected demand for related components, dampening investor sentiment.
In the U.S. stock market overnight, there was a significant sell-off in AI and semiconductor stocks. The Dow Jones Industrial Average fell 3.44%, while the Nasdaq Composite and the Standard & Poor's 500 Index dropped 5.52% and 4.36%, respectively. The declines in the Nasdaq and S&P 500 were the largest since the market was shaken by President Donald Trump's tariff announcements in April of last year.
Among individual stocks, SanDisk plummeted 22.26%, while memory-related stocks such as Micron (-17.46%) and SK Hynix American Depositary Receipts (ADR) (-13.40%) also saw significant declines. Major AI-related stocks, including AMD (-17.26%), Intel (-10.33%), and Broadcom (-10.43%), recorded double-digit losses.
* This article has been translated by AI.
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