(Update: prices, further details and background)

FRANKFURT (dpa-AFX) - The global sell-off following a strong rally continued for German chip stocks only during early trading on Monday. Shares in Infineon attempted to stabilize after plunging as much as 16 percent from their recent peak, the highest level seen since 2000. An initial decline of over four percent was reversed by mid-morning, turning into a 1.4 percent daily gain. This placed the stock at the top of the Dax in an otherwise weak market.

Internationally, profit-taking in overheated technology stocks has recently gained momentum. The trend began in the US semiconductor sector following a disappointing outlook from Broadcom, before downward pressure intensified in New York on Friday. The Nasdaq 100 ended the session before the weekend nearly five percent lower.

The slump was even more pronounced at the start of the week on technology-heavy Asian exchanges - from Japan and Taiwan to South Korea. Market observer Stephen Innes of SPI Asset Management referred to a 'Black Monday' in Seoul, where trading was briefly halted due to the volatility. The benchmark Kospi index ultimately shed more than eight percent.

'When the hottest playground suddenly turns into a frantic exit, traders take notice,' Innes explained. Domestically, Infineon's share price had already plummeted nine percent on Friday, after more than doubling this year and recently reaching a post-2000 high of 88.46 euros.

Other German companies linked to the semiconductor industry also followed the wave of selling in early Monday trading. This affected wafer manufacturer Siltronic as well as equipment suppliers Aixtron, PVA Tepla, and Suss Microtec. As with Infineon, most of these stocks recovered their initial losses.

Shares of the Seoul-based chip giant SK Hynix also attempted a recovery in German Tradegate trading on Monday, as did Nvidia in New York pre-market trading with a 1.1 percent gain. Marvell, Micron, and AMD even rose by up to seven percent pre-market, after being hit particularly hard by selling on the Nasdaq before the weekend.

According to traders, Friday's sell-off on US exchanges was relatively orderly, occurring gradually and without a moment of true panic. They are now questioning whether this was merely a 'refreshing pause'. 'In our view, Friday's market move was driven less by a fundamental shift in capital allocation and more by overheated positioning,' wrote William Beavington of the US bank Jefferies.

The question now turns to new catalysts, as the earnings season concluded last week with Broadcom, and major capital expenditures by internet giants Alphabet and Meta are already public knowledge. Attention may soon shift to the highly anticipated mega-IPOs of AI platforms OpenAI and Anthropic. However, the IPO series will be led later this week by SpaceX, a tech company from the aerospace sector./tih/niw/jha/