US Stock Market Move | Memory storage sector extends its decline, Western Digital Corporation (WDC.US) drops over 6%.

On Tuesday, the memory storage sector extended its decline, with Western Digital Corporation (WDC.US) and Seagate Technology Holdings PLC (STX.US) dropping over 6%, while Micron Technology, Inc. (MU.US), SanDisk (SNDK.US), and SK Hynix (SKHY.US) fell more than 5%. On the news front, over the weekend, Dr. Cao Kanyu, President of ChangXin Memory Technologies, announced at an industry event that the company has made key progress on a next-generation 4F memory cell architecture and plans to launch DDR5 server memory products based on this architecture by the end of 2026. This news sharply heightened market concerns that Chinese manufacturers are accelerating their penetration into the high-end memory chip market. The market's selling logic is clear: if Chinese manufacturers can enter the high-end memory chip market previously dominated by US and South Korean companies with lower costs and greater scale, the profit margins of related companies will face substantial compression. Some analysts pointed out that the core driver of this round of selling is deep-seated doubts about the return on AI investment. As the US earnings season is about to begin, investor confidence has clearly wavered over whether the massive AI spending by tech companies can sufficient returns amid a high borrowing cost environment. Chris Weston, Head of Research at Pepperstone, wrote in a report, "The pessimism in market sentiment is rare in recent times. Buyers have stepped aside to wait and see, while sellers have pushed prices down almost without resistance. Bears on the AI trade are currently in control."