Direxion Daily Semiconductors Bull 3x Shares (SOXL) plummeted 15.14% during intraday trading on Tuesday, as a confluence of negative catalysts sparked a broad sell-off in the global semiconductor sector and amplified losses in the leveraged ETF.

The sharp decline was driven by escalating concerns over the sustainability of massive artificial-intelligence infrastructure investments. A report involving Nvidia's potential funding for an AI data center project reignited doubts about the AI capital expenditure cycle, while TSMC's plans to raise wafer fabrication prices by up to 10% and impose surcharges on high-performance computing orders intensified fears of chip inflation. Additionally, growing competitive pressure from China added to the negative sentiment, as reports emerged of Chinese companies making significant progress in producing deep ultraviolet lithography machines, threatening the dominance of established players like ASML. The explosive trading debut of Chinese memory chip maker CXMT further stoked fears of increased competition.

The sell-off was not confined to the U.S., as South Korea's Kospi index plunged 11% in its worst session in four months, with heavyweights Samsung Electronics and SK Hynix tumbling 13% and 14%, respectively. As a 3x leveraged ETF tracking an index of major U.S.-listed semiconductor companies, SOXL's decline was significantly magnified relative to the underlying index movement.