On July 28th, South Korean chip stocks suffered significant losses. Reuters analyzed that this was due to growing concerns about the financing risks associated with investments in AI infrastructure, as well as concerns over increasing competition from Chinese companies.
During the day's trading, Samsung Electronics' stock price fell by 9.5%, while SK Hynix's stock price dropped by 11.1%. SK Hynix' shares listed in the United States had seen a significant decline overnight, closing at $143.02, below its initial public offering (IPO) price of $149.
The Korean Composite Stock Index (KOSPI) fell by more than 8% during trading on the 28th, triggering the market circuit breaker mechanism. This is the eighth time the KOSPI has triggered the circuit breaker mechanism this year.
Reuters believes that the collective selling in the Korean semiconductor sector is due to a series of recent events that have reignited market doubts about whether the "AI-driven semiconductor market can continue."
As a key supplier of NVIDIA's high-bandwidth memory (HBM) chips, SK Hynix has always been one of the biggest beneficiaries of the AI investment boom. Therefore, its stock price is particularly sensitive to changes in investor sentiment.
Analysts say that the sharp decline in semiconductor stocks is the result of multiple factors working together, including market concerns about AI infrastructure financing models, technological progress in China, and increased competition among Chinese companies.
Korea-based analyst Han Ji-young of Kiwoom Securities said that reports indicating Chinese companies are developing domestic deep ultraviolet (DUV) lithography equipment have caused concern in the overseas market. Chinese memory chip manufacturers may use these domestic equipment to accelerate capacity expansion, intensifying competition in the global memory chip market.
He pointed out that specific information such as the identities of related companies, equipment performance, and commercialization timelines has not yet been disclosed, but this news has already weakened investors’ confidence. Previously, the investment logic for semiconductor stocks began to show signs of weakening.
