A Chinese breakthrough in the chip industry hits technology companies and confuses global stocks

Global stocks fell to their lowest level in one month on Tuesday, as a widespread sell-off swept shares of chip manufacturers on concerns about Chinese competition and financing the artificial intelligence boom, while the prospect of a US interest rate hike added to the decline in sentiment.
Asian chipmakers were at the heart of a market sell-off on Tuesday, with Korea’s Kospi index falling more than 10% to a three-month low, triggering a suspension of trading on the stock exchange.
This coincided with China starting to manufacture domestically developed deep ultraviolet (DUV) lithography machines, a manufacturing tool that has long been dominated by the Dutch company ASML, which led to ASML shares falling by 8.5%.
The Chinese company CXMT, the fourth largest manufacturer of memory chips in the world, also listed its shares on the stock exchange on Monday, raising $8.6 billion, concluding the first trading session as the most valuable Chinese company.
In the American markets, stock exchanges are preparing for a weak opening, as shares of Nvidia and Micron Technology declined in pre-market trading.
Nvidia shares had already lost 5% overnight after the Wall Street Journal reported that the company was in talks to provide financing guarantees worth approximately $250 billion to OpenAI as part of a massive data center project.
On the other hand, European stocks outperformed thanks to positive earnings reports for Unilever and Mercedes-Benz, which contributed to offsetting losses in technology stocks.