Asian equities are rotating away from tech, Tickmill Group's Patrick Munnelly says. SK Hynix shares ended 9.6% lower despite stellar earnings, sending the Kospi 6.0% lower. Taiwan and Japan, with heavy semiconductor exposure, fell 3.8% and 1.5%, respectively. Chip makers have "moved from market darlings to volatility transmitters," as leadership shifts toward consumer discretionary, financials, and energy. The AI story hasn't disappeared, but tolerance for disappointment has collapsed.

Telefonica delivered strong second-quarter results, Bernstein analysts write. The Spanish telecom raised full-year guidance for adjusted operating cash flow after leases and swung to net profit with higher revenue. Shares are flat at 3.73 euros. The group appears on track to meet its full-year outlook.

The coming 2-nanometer main processors will further push up smartphone component costs, Counterpoint Research analyst Shenghao Bai says. DRAM memory chips have surpassed the main processor as the single most expensive part in flagships. Memory prices surged 80% in Q2 from the prior quarter, driving a nearly 50% year-over-year increase in flagship manufacturing costs. Even with higher retail prices, gross margins won't reach 2025 levels soon.