AI Rally Roars Back as SK Hynix and Samsung Electronics Post Best Days Ever
South Korea’s chip giants SK Hynix and Samsung Electronics each gained more than 20% on Friday, lifted by a sharp rally in U.S. technology stocks. The iShares Semiconductor ETF (SOXX) had jumped more than 8% overnight in U.S. trading. Strong earnings reports rekindled optimism about capital spending on artificial intelligence, sending technology stocks broadly higher. The rally helped drive sharp gains for the two leading chipmakers in Seoul. SK Hynix closed nearly 30% higher, its biggest one-day gain ever. Samsung Electronics surged nearly 27%, also setting a record for its largest one-day percentage gain. LG Innotek rose 21.23%, while Seoul Semiconductor gained 15%. Japan’s chip sector also climbed sharply. Advantest rose more than 16%, Tokyo Electron gained 6.24%, an incompletely identified company whose name appears as “Di” in the source rose 12.74%, Lasertec advanced 12.76%, and Renesas Electronics closed 7.7% higher. An unnamed group that owns Arm, described as a key market barometer for AI, rose 13.8% on the day. The source also states that an unnamed stock gained nearly 10%. Earlier this week, concerns that AI-sector valuations had become excessive and that competition from mainland Chinese memory-chip manufacturers was intensifying triggered a severe sell-off in Asia-Pacific semiconductor stocks. The latest surge across chip stocks marked a sharp reversal. Results from two major U.S. technology companies’ cloud businesses beat expectations overnight, sending money back into AI-chip stocks. The iShares Semiconductor ETF, or SOXX, jumped more than 8% in a single day. Amazon’s second-quarter revenue exceeded analysts’ expectations, while its cloud business remained strong; the stock rose more than 9% in after-hours trading. Microsoft surged 16% during regular trading on Thursday after growth in its Azure cloud-computing business came in better than expected. The results strengthened the market’s conviction that capital spending on AI infrastructure remains resilient. Andrew Jackson, head of stock strategy at Altus Consulting, said Microsoft’s better-than-expected earnings report “stimulated risk appetite and triggered a powerful, broad-based rebound in the AI sector,” reversing the recent decline in technology stocks. In a research note on Friday, Jackson wrote that Azure revenue significantly exceeded expectations and that Microsoft’s management had kept capital spending under reasonable control, easing investor concerns. He said the market was not embracing a model of expanding capacity by spending recklessly and without regard to cost, adding that investors had previously rejected such blind expansion.
The iShares Semiconductor ETF (SOXX) had jumped more than 8% overnight in U.S. trading.
Strong earnings reports rekindled optimism about capital spending on artificial intelligence, sending technology stocks broadly higher. The rally helped drive sharp gains for the two leading chipmakers in Seoul.
SK Hynix closed nearly 30% higher, its biggest one-day gain ever. Samsung Electronics surged nearly 27%, also setting a record for its largest one-day percentage gain. LG Innotek rose 21.23%, while Seoul Semiconductor gained 15%.
Japan’s chip sector also climbed sharply. Advantest rose more than 16%, Tokyo Electron gained 6.24%, an incompletely identified company whose name appears as “Di” in the source rose 12.74%, Lasertec advanced 12.76%, and Renesas Electronics closed 7.7% higher.
An unnamed group that owns Arm, described as a key market barometer for AI, rose 13.8% on the day. The source also states that an unnamed stock gained nearly 10%.
Earlier this week, concerns that AI-sector valuations had become excessive and that competition from mainland Chinese memory-chip manufacturers was intensifying triggered a severe sell-off in Asia-Pacific semiconductor stocks. The latest surge across chip stocks marked a sharp reversal.
Results from two major U.S. technology companies’ cloud businesses beat expectations overnight, sending money back into AI-chip stocks. The iShares Semiconductor ETF, or SOXX, jumped more than 8% in a single day.
Amazon’s second-quarter revenue exceeded analysts’ expectations, while its cloud business remained strong; the stock rose more than 9% in after-hours trading. Microsoft surged 16% during regular trading on Thursday after growth in its Azure cloud-computing business came in better than expected. The results strengthened the market’s conviction that capital spending on AI infrastructure remains resilient.
Andrew Jackson, head of stock strategy at Altus Consulting, said Microsoft’s better-than-expected earnings report “stimulated risk appetite and triggered a powerful, broad-based rebound in the AI sector,” reversing the recent decline in technology stocks.
In a research note on Friday, Jackson wrote that Azure revenue significantly exceeded expectations and that Microsoft’s management had kept capital spending under reasonable control, easing investor concerns. He said the market was not embracing a model of expanding capacity by spending recklessly and without regard to cost, adding that investors had previously rejected such blind expansion.