Samsung Electronics and SK Hynix have rebounded. However, the decline over the past seven trading days has not been fully recovered. Investor sentiment appears subdued amid forecasts that the debt burden for artificial intelligence (AI) investment will expand due to rising interest rates. The securities industry interpreted this as a situation where the value appeal of the semiconductor sector is being highlighted.
On the 16th, Samsung Electronics, the leading stock on the KOSPI, closed regular trading at 215,500 won, up 5,500 won (2.61%) from the previous day. After falling 10.56% the previous day to record a price in the 200,000-won range, Samsung Electronics rose again on this day. However, the current stock price is down 21.92% compared to the closing price on October 2.
SK Hynix, which accounts for a significant portion of KOSPI market capitalization as part of the semiconductor duet alongside Samsung Electronics, is also showing a similar trend. SK Hynix closed weekly trading at 1,272,000 won, up 10,000 won (0.79%) from the previous day. After exceeding 1.8 million won on the 2nd, SK Hynix fell for seven consecutive trading days before recording a slight increase on this day.
Analysis suggests that the decline in semiconductor sector stock prices reflects anxiety over AI investment. In the New York stock market, selling pressure concentrated on AI-related stocks, which had previously led market gains, continued until the 14th. As it was predicted that interest rate hike concerns would burden companies expanding AI infrastructure through massive borrowing, semiconductors were also hit.
These concerns were partially digested in the United States overnight. Although the U.S. producer price index (PPI) rose significantly, the three major indices of the New York stock market all rebounded. On the 15th (local time), the Dow Jones Industrial Average closed at 52,177.69, up 556.21 points (1.08%) from the previous day; the S&P 500 index rose 25.12 points (0.33%) to 7,744.06; and the NASDAQ Composite Index, centered on technology stocks, closed at 26,713.03, up 20.16 points (0.08%).
The securities industry assesses that the valuation appeal of the semiconductor sector has been highlighted. It is judged that uncertainty regarding the U.S. interest rate hike at the end of this month has already been reflected in stock prices in advance.
Researcher Byun Jun-ho of IBK Investment & Securities stated, "The sharp drop the previous day can be seen as having already reflected a significant portion of the possibility of a U.S. interest rate hike within the year, and from that perspective, it is highly likely to act as a factor resolving uncertainty around the October 28 FOMC (Federal Open Market Committee) meeting." He added, "It may take time to determine whether the noise currently being discussed regarding the AI industry will develop into a strong negative scenario, and there is also a possibility that concerns will ease, in addition to the potential for new positive news related to AI to emerge."
Researcher Han Dong-hee of SK Securities stated, "Samsung Electronics and SK Hynix are having their earnings forecasts revised upward due to factors such as worsening-than-expected memory supply shortages despite the decline in the won/dollar exchange rate, and expectations for higher HBM (High Bandwidth Memory) prices next year." He added, "The rebound and recovery of stock prices arise from the process where numerous concerns raised during the price decline do not materialize, rather than from new momentum, and the strength of the semiconductor industry remains ongoing."
Researcher Lee Chang-min of KB Securities stated, "The shareholder return policy expected to be detailed in the earnings conference calls of Samsung Electronics and SK Hynix at the end of this month will serve as an important turning point in reducing the extreme gap between stock prices and corporate valuation and reversing investor sentiment." He revealed, "Based on next year's expected earnings, the PER (price-to-earnings ratio) is only 3.1 times for Samsung Electronics and 2.6 times for SK Hynix, entering an extremely undervalued zone at historically low levels."
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