MPC Markets Morning Call — 24 June 2026: Chip-Wrecked
A South Korean media report questioning SK Hynix’s commitment to AI memory production triggered the worst single-day collapse in the Philadelphia Semiconductor Index since the early days of the Iran war, dragging the Nasdaq 100 down 3.3% and sending shockwaves across global equity markets. The S&P 500 shed 1.4% to close at 7,365.67, with the tech sector alone surrendering 3.7%. The selloff arrived just as markets had been pricing in a hawkish Federal Reserve pivot, with futures now pointing to two rate hikes before year-end. The ASX is set to open modestly higher this morning, with Australian CPI data for May landing today — a critical read for the RBA’s next move.
The AI trade took a wrecking ball on Tuesday as a single ChosunBiz report claiming SK Hynix was pivoting away from high-bandwidth memory (HBM) chips toward commodity DRAM set off a chain reaction that wiped close to a trillion dollars from the Nasdaq composite. South Korea’s KOSPI plunged 10% — its second-largest single-day drop on record — with SK Hynix and Samsung each falling more than 12%. In the US, the Philadelphia Semiconductor Index cratered 7.9%, while Micron – down 13% – now faces an existential test when it reports quarterly results on Wednesday. The hawkish Fed backdrop compounded the damage, with futures markets now fully pricing a September rate hike and a greater than 50% chance of two hikes by December. In commodities, Brent crude fell a further 0.8% to $76.94 amid rising Strait of Hormuz traffic following the US–Iran interim peace deal, while gold slid 1.9% to $4,111.60. The Australian dollar dropped 1% in step with the broader non-USD selloff. ASX 200 futures are pointing to a modest 0.4% open at 8,787, but today’s domestic CPI print and RBA Deputy Governor Hauser’s address will be the real focus for local markets.
The S&P 500 fell 1.4% to 7,365.67, the Nasdaq 100 dropped 3.3%, and the Dow Jones slipped 0.1% to 51,665; the Philadelphia Semiconductor Index collapsed 7.9% and South Korea’s KOSPI plunged 10%.
A ChosunBiz report alleging SK Hynix is deprioritising AI memory (HBM) chip production in favour of commodity DRAM triggered forced liquidations and stop-outs across the global semiconductor trade.
Brent crude fell 0.8% to $76.94 and WTI slipped 0.5% to $73.46 as Strait of Hormuz tanker crossings surged from 3 to 42 week-on-week; oil is now down 40% from its Iran war peak above $100/bbl.
The US dollar index rose 0.4% to its highest level in over a year as hawkish Fed repricing drove yields lower — 10-year Treasuries settled at 4.50% — while gold fell 1.9% to $4,111.60 and Bitcoin shed 3%.
Apollo Global imposed a 5% cap on withdrawal requests from its largest private credit fund after investors sought to pull 17% of assets, signalling growing stress in the non-traded credit space.
ASX 200 futures point to a +0.4% open at 8,787; the AUD fell 1% overnight and Australia’s May CPI print lands today alongside a speech from RBA Deputy Governor Andrew Hauser.
Equities — The Chip-Wreck Arrives
What started as a modest overnight pullback became a full-scale rout by the time Tuesday’s US session closed. The Nasdaq 100 surrendered 3.3%, the Nasdaq Composite lost 2.2% to settle at 25,587, and the S&P 500 finished 1.4% lower at 7,365.67 — with the index’s technology subindex alone falling 3.7%. The Dow Jones Industrial Average ended effectively flat, dipping just 0.1% to 51,665. The MSCI World Index dropped 1.4%. BTIG’s chief market technician Jonathan Krinsky coined the session’s defining phrase: “Chip-Wreck.” He sees a further 10–15% downside for the semiconductor group from current levels.
The catalyst was a ChosunBiz report claiming SK Hynix — one of the defining winners of 2026’s AI frenzy through its high-bandwidth memory (HBM) chips — was reallocating production lines back toward mainstream commodity DRAM. The stock plunged more than 12% in Seoul, dragging Samsung Electronics down by a similar margin and pushing the KOSPI to a 10% collapse, its second-biggest single-day fall in history. Foreign investors offloaded more than $2.5 billion of Korean equities in a single session, with forced liquidations and leveraged ETF-related stop-outs amplifying the move. In the US, Micron dropped 13%, Marvell and Lam Research each fell sharply, and all 30 members of the Philadelphia Semiconductor Index closed in the red as the index cratered 7.9%. “AI investors were spooked today by a media report out that SK Hynix is repurposing a production line,” said Michael O’Rourke, chief market strategist at Jones Trading. “The sell-off has pushed the Magnificent 7 into negative year-to-date territory.”
The macro backdrop made things worse. Fed fund futures have now repriced to reflect two rate hikes before year-end, with September fully in play. Higher yields weigh hardest on long-duration growth names — and after the SOX index had more than doubled from its war-driven lows to hit a record high just on Monday, the technical setup was ripe for a flush. Not everyone is ready to call the end of the rally. Evercore ISI’s Julian Emanuel argued that tech giants will return to favour once earnings deliver “the proof of the pudding,” while Louis Navellier described Micron’s upcoming results as the grand finale to a “stunning” earnings season. Edward Jones’ Brock Weimer counselled that “diversification remains key to managing risk, particularly after the strong gains in technology.” Wednesday’s Micron print will go a long way to determining which camp is right.
Jonathan Krinsky, chief market technician at BTIG, said Tuesday’s action was a “Chip-Wreck” and that he continues to see medium-term downside risk for the tech/AI trade. He estimates between 10% and 15% additional downside in the semiconductor group from current levels. Krinsky cautioned against interpreting any near-term bounce as a signal that the de-rating is complete.
Michael O’Rourke, chief market strategist at Jones Trading, noted that the selloff has pushed the Magnificent 7 into negative year-to-date territory, with investors rotating into consumer staples, health care and utilities. He described the AI memory report as creating “concern about the pace of AI demand” that led to broad profit-taking in the semiconductor and memory spaces which had driven the majority of S&P 500 YTD gains.
Geopolitics — Iran Signals, UK Leadership Limbo
Contradictory signals around the US–Iran nuclear deal continued to generate noise but not fear — at least not in oil markets, where the price story is increasingly being told by tanker flows rather than diplomatic communiqués. President Trump claimed on Tuesday that Iran had “fully and completely agreed to highest level nuclear inspections long into the future,” and that in exchange he had agreed to keep the Strait of Hormuz open with no further naval blockade. “Yesterday, we had 19 million barrels of oil come out — and that’s the biggest in the history of the Hormuz Strait,” Trump said. Iran’s state media flatly denied any arrangement for IAEA inspections, with foreign ministry spokesperson Esmaeil Baqaei saying no such meeting had occurred. Trump responded by saying: “They’re wrong... They told us inside and we have it down, 100%.”
Whatever the diplomatic reality, the market has made its peace with the situation. Kpler data showed Hormuz vessel crossings surging from just 3 to 42 week-on-week on Saturday — tankers are moving regardless of the rhetorical back-and-forth. The US also waived Iran sanctions for 60 days on Monday after initial peace talks concluded. The combination of rising tanker traffic and the softening sanctions posture has effectively dismantled the geopolitical risk premium that drove oil above $100/bbl in the weeks after war broke out. Oil is now down 40% from its peak.
In the UK, Prime Minister Keir Starmer’s resignation on Monday rattled confidence but left markets relatively composed. The focus has shifted to how quickly his likely successor Andy Burnham can be appointed and who Burnham might choose as finance minister. Tuesday also marked the 10th anniversary of the Brexit referendum, and analysts noted that political uncertainty and elevated risk premiums in UK assets look set to persist given the depth of the country’s divisions and its revolving door of prime ministers.
Reuters columnist Jamie McGeever noted that investors may struggle with Federal Reserve communications under new chair Kevin Warsh if he adopts the more opaque messaging style of the Alan Greenspan era. The chasm between Citi and Bank of America’s current Fed call — with no clear market consensus — suggests the lack of clear forward guidance is already playing out in elevated rate volatility. A September hike is now fully priced; two hikes by year-end carries more than 50% probability.
Energy, Commodities & FX
Crude oil continued its remarkable descent from the highs of the Iran war. Brent crude futures settled 0.8% lower at $76.94 a barrel on Tuesday — their lowest close since hostilities began in late February — while WTI fell 0.5% to $73.46. Brent is comfortably below $80/bbl and WTI is now approaching a potential test of the $70/bbl level. From a macro perspective, oil’s collapse is doing the heavy lifting for the disinflation narrative: the year-on-year change in WTI had fallen to essentially zero as of Monday. Policymakers will welcome the reprieve from what had been a significant inflationary shock in the first quarter.
The Strait of Hormuz is reopening in practice, even if the diplomatic language remains contested. Kpler’s data showing tanker crossings jumping from 3 to 42 week-on-week confirms that commercial shipping operators are proceeding regardless of the political noise. With Iran sanctions waived for 60 days and an interim memorandum of understanding in place, the supply disruption that initially sent prices surging is steadily unwinding. The question for oil bulls now is whether the structural demand picture — given softening global PMI readings and a hawkish Fed — provides any floor.
Elsewhere in commodities, gold sold off 1.9% to $4,111.60 an ounce and silver fell 5% to its lowest close of the year, as the dollar surged and the risk-off trade proved insufficient to generate safe-haven buying. The Bloomberg Dollar Spot Index rose 0.4% to its highest level in over a year, hammering commodity currencies: the AUD fell 1%, alongside similar declines in the Swedish krona and Norwegian krone. The euro dropped 0.4% to $1.1379 and the British pound fell 0.4% to $1.3200. The Japanese yen continued to flirt with 40-year lows against the dollar at around ¥161.60, as Fed-fuelled dollar strength outweighed the impact of last week’s Bank of Japan rate hike. Reports emerged of contact between Tokyo and Washington officials on yen stability, keeping intervention fears simmering. Bond markets found some relief: 10-year Treasuries fell one basis point to yield 4.50%, while German 10-year Bunds declined three basis points to 2.92%.
Corporate & Private Credit — Big Money on the Move
SpaceX’s post-IPO turbulence extended into Tuesday with the stock briefly dipping below its IPO opening price of $150, hitting a session low of $147.11 before recovering to close around $164 — up roughly 6% on the day. The stock is still 14% above its $135 listing price, but the 35% drop from its post-IPO peak has wiped more than $600 billion of market value and is focusing minds. Options markets are now evenly balanced between bulls and bears, a significant shift from the opening day euphoria: contracts expiring July through September with strike prices between $125 and $190 show nearly two puts for each open call. S3 Partners estimates 5–7% of the float is currently sold short, with borrow costs at around 60 basis points. Upcoming catalysts are numerous: Russell Index inclusion on Friday (Jefferies estimates $2.68 billion of passive inflows), Nasdaq 100 addition on July 6, and the end of the analyst quiet period on July 7. SpaceX also drew approximately $89 billion of demand for its debut US bond offering, setting the stage for one of the biggest investment-grade deals of the year.
FedEx beat quarterly profit estimates but its shares fell nearly 6% in after-hours trade as margins disappointed. Operating margin in the core Federal Express segment fell to 7.7% from 8.4% a year earlier as employee, transportation and fuel costs all climbed. Revenue rose 12.6% to $25 billion, topping expectations of $24.04 billion, and the company projected 11% revenue growth for 2026 with EPS guidance of $16.90–$18.10. The mixed result reflects the tension in the delivery sector between strong domestic demand and the headwinds from Trump tariffs and the elimination of de minimis exemptions for low-value Chinese e-commerce shipments.
Apollo Global Management has once again imposed a 5% cap on withdrawal requests from its largest non-traded private credit fund after investors sought to pull 17% of assets — the second such gate in recent months. The development is a reminder that liquidity mismatches in retail-facing private credit vehicles remain a structural vulnerability. Goldman Sachs, by contrast, reported that its equity trading desk is on track to generate more than $5 billion of revenue in Q2 — a new record — underscoring how differently market conditions are playing out across the capital markets spectrum.
David Morrison, senior market analyst at Trade Nation, raised the central question hanging over the AI trade: “Historically, mega-cap US tech companies funded expansion from operating cash flow and occasionally debt. Last week Nvidia said it would raise $25 billion through a bond offering, its first in five years. So corporations are looking to raise a lot of money this year, not forgetting the expected IPOs from Anthropic and OpenAI after the summer. The money must come from somewhere.” Alphabet has already announced an $80 billion stock sale to fund AI infrastructure, while Meta is reportedly considering a major public offering for the same purpose.
ASX Outlook & Day Ahead
Australian shares are set to open modestly higher despite the carnage in US tech, with ASX 200 futures pointing to a gain of 35 points, or 0.4%, to 8,787 at the open. The resilience reflects the ASX’s relatively low exposure to semiconductor names compared with North Asian markets. What hits different this morning is the Australian dollar, which tumbled 1% overnight in lockstep with other high-beta currencies as the US dollar surged to its highest level in over a year. For the RBA, that’s an inflationary complication on the import side, arriving on the very day Australia’s May CPI data hits the tape.
Three ASX corporate stories are worth watching. IFM Investors has now secured more than 50% of Atlas Arteria, automatically pushing back the closing date of its $7.4 billion takeover bid to July 7. The independent chair continues to recommend shareholders reject IFM’s $5.10 per share offer as significantly undervaluing the toll road operator, and a supplementary target’s statement is expected before Monday’s open. Citi has cut its earnings forecasts and price target for Sonic Healthcare by around 12% to $19, citing persistent labour cost pressures and below-average pathology volume growth in Australia, though the broker maintained its neutral rating. And KMD Brands — owner of Rip Curl and Kathmandu — flagged a 1-for-25 share consolidation that will reduce its share count from approximately 1.8 billion to around 72 million, alongside a board change with David Kirk departing and commercial lawyer John Strowger joining on July 1.
Wednesday 24 June shapes as a macro-heavy day for Australian investors. The May CPI print is the headline domestic number, arriving as the RBA weighs whether the disinflation trend has progressed sufficiently to justify a rate cut. RBA Deputy Governor Andrew Hauser also speaks today, and his comments on the inflation outlook and the AUD’s overnight fall will be closely parsed. Micron Technology’s earnings after the US close will set the tone for Asian tech markets into Thursday.
- Australia CPI — May (Today, AEDT morning) — The RBA’s key near-term data point. Markets are watching for further evidence of disinflation; a hotter-than-expected print would complicate rate cut timing and may push AUD lower.
- RBA Deputy Governor Andrew Hauser Speaks (Today, AEDT) — Hauser’s commentary on the inflation path and potential RBA response to the AUD’s overnight 1% fall will be closely watched by fixed income and FX traders.
- Micron Technology Quarterly Results (Wednesday US close / Thursday AEDT) — The biggest market event of the week. If Micron’s numbers confirm strong AI chip demand, it could reverse Tuesday’s semiconductor rout; a miss would validate the bears and pressure Asian tech names into Thursday.
- Bank of Japan — June Policy Meeting Summary (Today) — Summary of the June 15–16 BOJ meeting. With the yen near 40-year lows at ¥161.60 despite last week’s rate hike, any hawkish signals could trigger yen intervention speculation.
- Bank of Japan Deputy Governor Ryozo Himino Speaks (Today) — Further colour on the BOJ’s view on the yen weakness and future rate path.
- US Revised Q1 GDP & PCE Inflation (Wednesday US morning) — The PCE reading is the Fed’s preferred inflation gauge. A hot number would reinforce two-hike pricing and add further pressure to growth stocks.
