ASML Holding NV shares surged 5.01% during pre-market trading, leading a broad recovery in the semiconductor equipment sector after a prolonged sell-off.

The rebound comes as analysts view the recent downturn as an overreaction to news that a Chinese state-backed company had begun mass-producing immersion DUV lithography machines. The Chinese firm's initial target of around five units this year pales in comparison to ASML's delivery of 131 immersion DUV systems last year, suggesting limited near-term fundamental impact despite a decline in ASML's China revenue share from 19% in the first quarter to 14% in the second quarter.

Other semiconductor equipment stocks also rallied, with Applied Materials gaining nearly 5%, Lam Research surging over 8%, and KLA-Tencor and Teradyne both advancing more than 3%, underscoring the sector-wide nature of the recovery.