Samsung and SK Hynix Plunge as China Chip Fears Intensify - Yahoo Finance

What the report says

Yahoo Finance, carrying a GuruFocus report by Khac Phu Nguyen, said shares of South Korean chipmakers Samsung Electronics and SK Hynix fell sharply on Tuesday amid a broader regional selloff in semiconductor stocks. According to the report, Samsung dropped 13.4%, its steepest one-day fall in nearly 20 years, while SK Hynix declined 14.7%. The pressure helped drag South Korea’s KOSPI index down 10.8%.

The report attributed the market reaction to several investor worries: funding for artificial-intelligence infrastructure, elevated chip-sector valuations, and the possibility of stronger Chinese competition. It said concerns intensified after reports that Chinese firms were working on domestic deep-ultraviolet lithography technology, which investors viewed as a potential step toward faster expansion by Chinese memory-chip producers.

SK Hynix was singled out because of its exposure to high-bandwidth memory, a key component in AI systems, and its role as a supplier to Nvidia. Yahoo Finance reported that SK Hynix’s U.S.-listed shares had already fallen 7.5% on Monday to $143.02, below their $149 listing price from an earlier July Nasdaq debut. The company was scheduled to report earnings on Wednesday, giving investors a near-term test of demand expectations around AI chips.

The move matters because Samsung and SK Hynix together account for nearly half of the KOSPI, making their declines especially influential for South Korea’s benchmark index. The central question for investors, as framed by the report, is whether SK Hynix’s results can justify optimism around HBM demand and whether China’s chip-equipment efforts can become commercially competitive.