Chinese tech stocks plunged Thursday, led by semiconductor names, as concerns over stretched valuations and crowded positioning intensified a rotation out of one of this year's best-performing sectors. The Philadelphia Semiconductor Index retreated for a fourth straight session in its longest losing streak this year. The MSCI World Semiconductor index plunged more than 15% this month, its worst performance since 2022, though still up 28% for the year.

Shares in chip and memory stocks slid, with Intel Corp., Advanced Micro Devices Inc., Sandisk Corp., Western Digital Corp. and Seagate Technology Holdings falling. South Korea's Kospi sank 11%, with Samsung Electronics Co. and SK Hynix Inc. each sliding more than 14%. European stocks also underperformed: Infineon Technologies AG and STMicroelectronics NV fell 6.9% and 4.7%, while ASML Holding NV dropped 3.4% after reports a Chinese state-backed company began mass-producing immersion deep ultraviolet lithography machines.

Doubts over AI spending returns and valuations deepen. Nvidia Corp.'s $750 billion in infrastructure deals fuel concerns over AI-related debt and "circular" deals between manufacturers and startups. The cost of protecting Nvidia's debt against default surged by a record. CXMT Corp. completed an IPO to expand memory chip production, potentially driving down global prices. Investors await earnings from Meta Platforms Inc. and Amazon.com Inc. for direction.