Chip Stocks Plunge as Moonshot AI's Kimi K3 Model Triggers AI Spending Jitters; Philly Semi Enters Bear Market

According to Business Insider, Moonshot AI, a Chinese AI startup, unveiled its latest model Kimi K3 on Friday (July 17), reigniting concerns about AI capital expenditure. Market analysts noted that Kimi K3's performance rivals OpenAI and Anthropic's advanced models while requiring significantly fewer chip resources, echoing fears of a repeat "DeepSeek moment" that wiped out $1 trillion in tech stock value last year.

The Philadelphia Semiconductor Index fell 1.63%, closing at 11,673.889, sliding over 20% from recent highs to enter bear market territory. Major chipmakers declined sharply: Samsung Electronics dropped 8.77%, Taiwan Semiconductor Manufacturing Company (TSMC) fell 7.29%, Intel declined 2%, and Nvidia slid 2.21%. The Nasdaq-100 index fell 1.49%, while the S&P 500 dropped 1.01%.