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Kimi K3 open-weight model triggers selloff in semiconductor ETFs
The VanEck Semiconductor ETF (SMH) broke below a key moving-average support band for the first time since April, extending a selloff that left it more than 20% under its late-June record high.
Moonshot AI launched Kimi K3, a 2.8-trillion-parameter open-weight model, on Thursday, and the release reverberated through Wall Street on Friday as semiconductor and AI-linked shares fell broadly. Decrypt said SMH, the VanEck Semiconductor ETF, dropped below a key support band tied to its moving-average trend for the first time since April, pushing the fund deeper into a rout.
Decrypt reported that the selling intensified across markets, citing declines of more than 6% in Taiwan’s benchmark and a 4% drop in Japan at the close. In the US, the Nasdaq slid 1.5%, its worst session of the week, as the sector-wide pressure spread beyond individual chip names.
The article linked the market reaction to the perceived implications for US AI spending, drawing a comparison to DeepSeek’s earlier model release that had shifted assumptions about how much frontier spending is needed for frontier performance. Decrypt also said Nvidia lost about $590 billion in market value in a single session during the move.
Decrypt added that full model weights are scheduled to go public on July 27 under a Modified MIT license that would make the model available for free to smaller labs. It said K3 scored 57 on the Artificial Analysis Intelligence Index, ranking above other models in the same composite benchmark while operating at a fraction of the price, according to the outlet.
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