South Korea's Kospi sinks 10.8% as the same selloff hits harder overseas
Canada's benchmark equity index closed at a record high on Tuesday, extending its climb as investors rotated out of semiconductor stocks and into sectors more supportive of the domestic market.
The S&P/TSX composite index rose 181.56 points, or 0.5 percent, to 35,749.70, eclipsing Monday's record close, Reuters reported.
According to Michael Dehal, a senior portfolio manager at Dehal Investment Partners at Raymond James, investors were shifting out of chipmakers and into financial and software names.
"It's more of a rotation in the market," he told Reuters.
Technology led the Toronto gains, climbing 5.1 percent.
Celestica added 9.5 percent after the electronics manufacturer beat earnings estimates, Reuters reported, while Constellation Software rose 6.4 percent.
Financials advanced 1.1 percent and consumer staples ended 2 percent higher.
Materials weighed on the index, falling 1.6 percent as gold prices dropped.
US markets were mixed.
The Dow Jones Industrial Average jumped 537.24 points, or 1.03 percent, to 52,747.32, its third straight winning session, while the S&P 500 added 0.21 percent to 7,428.78 and the Nasdaq composite slipped 0.22 percent to 24,876.91.
Chipmakers drove the divergence.
Micron Technology fell 8.9 percent and was the heaviest weight on the S&P 500, according to the Canadian Press, followed by Advanced Micro Devices, down 8.1 percent, and Applied Materials, off 7.8 percent.
The Philadelphia Semiconductor Index shed 4.5 percent, Reuters reported, leaving it about 25 percent below its June 22 record though still up 56 percent for 2026.
Behind the selling sit questions about whether the AI-fuelled growth of recent quarters can hold.
Big spenders on computer memory could scale back if the technology fails to deliver the promised profit or productivity, and cheaper AI models from China could dampen demand for memory and computing power, the Canadian Press reported.
The Associated Press reported that the concern hit harder overseas, where sharp drops in SK Hynix and Samsung Electronics dragged South Korea's Kospi down 10.8 percent and briefly halted Seoul trading.
Investors now turn to a heavy week of results from the largest AI spenders.
Meta Platforms and Microsoft report Wednesday and Amazon on Thursday, per the Canadian Press, alongside Apple, which briefly touched a US$5tn market value on Tuesday, according to Reuters.
Brian Madden, chief investment officer with First Avenue Investment Counsel, said the biggest US technology results would set the tone for both markets.
Madden said the firm will be watching the "big Mag Seven" tech earnings out of the US, since those set the tone for the American market.
When US stocks run "super green," Canada often follows, he said.
Oil eased for a fourth session.
The September West Texas Intermediate contract fell US$3.35, or about 4 percent, to settle at US$79.26 a barrel, the Canadian Press reported, as traders weighed the prospect of talks between the United States and Iran over access to the Strait of Hormuz.
Madden said the market now treats crude mainly as a geopolitical gauge rather than a supply-and-demand signal.
The price, he said, has become a "tradable proxy" on escalation or de-escalation in the Persian Gulf conflict.
The retreat in crude trimmed bets on a US Federal Reserve rate increase, the Canadian Press reported, ahead of the central bank's decision Wednesday.
Reuters put the odds of a quarter-point hike at 29 percent, with the rest of traders expecting no change; the Canadian Press pegged the probability nearer 31.5 percent, down from more than 36 percent a day earlier.
The loonie traded at 70.91 cents US, up from 70.85 cents on Monday.
The August gold contract fell US$38.30 to US$4,038.70 an ounce.
