Key Takeaways
- Samsung and SK Hynix led a sharp semiconductor selloff across Asian markets.
- Wall Street’s chip stock losses triggered broad declines in regional technology shares.
- SK Hynix maintained long-term AI investment plans despite the market downturn.
Samsung SK Hynix shares plunged Thursday after a broad U.S. semiconductor selloff spread to Asia, erasing billions in market value and dragging South Korea’s benchmark Kospi sharply lower.
Samsung Electronics closed down 9.06% while SK Hynix lost 14.57% after both companies opened with steep declines. The losses followed a weak session on Wall Street, where investors sold semiconductor stocks amid broad profit-taking.
The two companies account for about half of the Kospi’s total weighting, making their performance a major driver of the South Korean stock market.
Heavyweight chipmakers drag down regional markets
The decline extended beyond South Korea as technology and semiconductor shares fell across Hong Kong and mainland China.
Shares of Semiconductor Manufacturing International Corporation, China’s largest contract chipmaker, dropped more than 11%, while Hua Hong Grace fell 14%. Knowledge Atlas Technology, the Hong Kong-listed company linked to Chinese AI developer Zhipu, declined more than 17%. Shanghai Iluvatar CoreX Semiconductor also fell nearly 18%.
Commenting on the sharp decline in Samsung SK Hynix shares, Zavier Wong, a market analyst at eToro, said the two companies now make up around half the Kospi’s total weight, up from around just a quarter at the end of last year.
“A sharp move in either name drags the whole index with it before the other roughly nine hundred listed companies get a say,” Wong said.
The regional decline mirrored losses in the United States. Micron Technology dropped more than 10% despite strong gains earlier this year. Sandisk also fell more than 10%, while Nvidia and Broadcom each declined between 1% and 2%.
SK hynix unveils major investment plan
Despite the market selloff, SK Hynix announced plans to invest 100 trillion Korean won, or about $64.37 billion, in South Korea to expand semiconductor production and artificial intelligence infrastructure.
Chief Executive Officer Kwak Noh-jung said the company will spend 80 trillion won on its planned M17 fabrication plant, which is expected to begin construction next year and start operations during the first half of 2029. Another 20 trillion won will support advanced chip packaging and assembly facilities.
“These investments are aimed at meeting the soaring demand for HBM servers and DRAM, as well as enterprise SSDs and NAND, as AI services take off,” Kwak said during a public briefing in Asan.
Kwak also said SK Group plans to expand artificial intelligence data centers across South Korea, beginning with 5 gigawatts of capacity before eventually reaching 15 gigawatts.
The announcement follows the South Korean government’s plan unveiled earlier this week to support the country’s semiconductor industry, including a proposal for Samsung Electronics and SK Hynix to invest a combined 800 trillion won as part of a national semiconductor ecosystem project.
Despite the sharp decline in Samsung SK Hynix shares, SK Hynix is scheduled to begin trading American depositary receipts on the Nasdaq on July 10, giving U.S. investors broader access to the company’s shares.
