On July 17, Western Digital fell 3.54% in regular trading, trading at $438.13/share, with turnover of $575 million. The storage sector remained under broad selling pressure, with peers SanDisk down 5.46% and Seagate Technology down 3.97%.

On the news front, South Korea's Financial Services Commission officially announced tightened regulations on single-stock leveraged ETFs, raising the minimum margin requirement from 10 million KRW to 30 million KRW with only cash accepted, while simultaneously banning the listing of new single-stock leveraged products. Korean retail investors had previously accumulated massive positions in the storage sector through 2x leveraged ETFs linked to Samsung Electronics and SK Hynix. The regulatory tightening directly triggered forced liquidations and capital outflows, with selling pressure rapidly transmitting to U.S.-listed storage stocks.

The storage sector had previously surged on AI demand expectations, accumulating significant unrealized gains. Under the regulatory headwind, funds concentrated on profit-taking, amplifying downside pressure across the board.

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