Samsung Electronics and SK Hynix rebounded on Wednesday as bargain hunters returned to South Korea’s semiconductor trade.
Samsung rose about 3% and SK Hynix roughly 2% in early trading, helping the KOSPI jump more than 2% before gains were pared back.
The bounce followed a brutal Tuesday when foreign investors sold a combined 3.72 trillion won of the two chipmakers, driving Samsung down 7.39% and SK Hynix down 10.09%.
Tuesday’s collapse may have overshot the fundamentals
Foreign investors sold 4.52 trillion won of KOSPI shares in one session, with Samsung and SK Hynix accounting for about 82% of that total.
Yet the sell-off was not matched by an equivalent deterioration in earnings expectations.
KB Securities research head Kim Dong-won said Wednesday that the two stocks appeared to have formed a “second trough” in a W-shaped rebound.
He argued that the decline reflected supply-demand instability and heavy foreign selling more than deterioration in the semiconductor business.
That distinction matters because valuations have compressed quickly. KB said both stocks are now trading around three times earnings and 1.4 times book value, close to previous periods of extreme pessimism.
The buyer thesis is straightforward. Share prices fell much faster than profit forecasts.
AI demand has not broken, even if confidence has
CXMT’s progress in advanced DRAM raises the possibility that Chinese supply could eventually weaken the scarcity and pricing power enjoyed by Samsung and SK Hynix. But that is a medium-term risk, not an overnight earnings shock.
Near-term demand from hyperscalers and AI infrastructure customers remains strong.
Mirae Asset Securities executive Seo Sang-young said the recent improvement in US AI semiconductor shares and steady performance from major AI demand companies could stimulate buying interest, even though semiconductor supply-demand instability may persist.
Buyers do not need to conclude that CXMT is irrelevant. They only need to believe the threat is unlikely to hit earnings as quickly as Tuesday’s price collapse implied.
The Philadelphia Semiconductor Index fell only about 0.2% on Tuesday, a sharp moderation from the previous session’s 2.7% rout, easing pressure spilling from Wall Street into Seoul.
Foreign flows will decide whether this rebound is real
The strongest confirmation signal is whether foreign investors keep buying.
At 9:12 a.m. Wednesday, foreigners had switched to 44.2 billion won of net KOSPI buying as Samsung and SK Hynix led the rebound.
But that shift was tiny compared with Tuesday’s 4.52 trillion won exodus. By around 10:20 a.m., foreigners had turned net sellers again, offloading 134.1 billion won as the KOSPI pared most early gains.
Hana Securities researcher Kim Du-eon said he still expects an upward trend in Korean equities, but argued that easing inflation and interest-rate pressure, manufacturing recovery and won stability will be important for sustaining foreign spot purchases.
Wednesday’s US inflation report therefore matters directly. A hotter reading that pushes Treasury yields higher could quickly test the rebound, while a calmer rates backdrop would make it easier for foreign money to return.
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