Taiwan's Genius Electronic Optical hit its daily loss limit after foreign brokers cut their ratings, a sharp negative for investors who chased the stock's run-up.

• The stock fell 10% to its floor, breaking below the NT$1,000 mark, with heavy unfilled sell orders piling up.
• Foreign brokers say the price ran too far ahead of the actual business and downgraded both Genius and rival Largan Precision.
• Both companies had been bid up on hopes for co-packaged optics, a technology for faster data links inside AI servers.
• Genius still has a solid near-term story: Apple is a huge share of its sales, and the new iPhone launch should lift third-quarter results.
• Day traders made up two-thirds of last Friday's volume, so the swings are likely to stay wild.

Outlook: Its co-packaged optics parts are not due for mass production until next year or later, so the stock stays at the mercy of Apple sales and short-term traders.