Popular South Korean chip stock SK Hynix plunged on Wednesday as a sell-off in AI semiconductor stocks overshadowed investor enthusiasm ahead of the memory giant’s debut on Nasdaq later this week.

The stock fell along with its semiconductor peers, including Samsung Electronics, despite demand for SK Hynix’s upcoming U.S. listing, which is several times oversubscribed, Bloomberg reported Tuesday.

SK Hynix shares closed down 5.7%, while Samsung Electronics ended the day down 6.3%. Losses in index heavyweights dragged South Korea’s Kospi index down 5.4%.

Volatile trading in South Korean stocks reflected a broader sentiment of risk aversion as investors digested rising tensions between the United States and Iran and Washington’s decision to revoke a waiver allowing new sales of Iranian oil.

Japan’s Nikkei 225 closed down 2.1%, while oil futures were up more than 3% at 2:49 a.m. ET.

The losses came after a tough day in US chip trading on Tuesday that sent the Philadelphia Semiconductor Sector Index down 5% after its best quarter ever.

The market moves underscore how quickly sentiment toward AI stocks has changed. The change comes even as SK Hynix remains one of the biggest beneficiaries of the boom, thanks to its dominance in the high-bandwidth memory chips used in Nvidia’s AI processors. SK Hynix shares are still up more than 200% this year.

Even with the near-term volatility, analysts say the company’s planned U.S. IPO still makes strategic sense.

“A US listing can broaden the investor base, improve liquidity and potentially reduce valuation gaps with US semiconductor peers,” Charu Chanana, chief investment strategist at Saxo, wrote on Wednesday.

But the timing is testing investor appetite amid growing doubts about the huge capital being poured into AI infrastructure.

“It brings a big new block of AI-linked stock supply to the market just as investors are wondering whether AI infrastructure stocks have gone too far,” Chanana said.

He added that investors are now grappling with the next phase of the industry.

“That is the key tension for investors. The same reason the sector is attractive today (tight supply and strong prices) is also encouraging the next wave of capacity,” he wrote.