South Korea’s Kospi led gains in most Asian markets on Friday, as a record sell-off in US shares by chip titan SK hynix breathed new life into the tech sector after weeks of selling.
SK’s surprise $26.5 billion listing gave investors a much-needed affirmation that the AI boom remains on track, despite lingering concerns about stretched valuations and large capital expenditures.
The news came as attention turns to the upcoming earnings season, with traders looking to companies’ outlook for the industry and investment plans amid expectations that interest rates will remain high for now.
SK hynix set a price of $149 per American depositary share (ADS) – slightly higher than Seoul’s closing price on Thursday – ahead of its Nasdaq debut on Friday.
That meant it had raised $26.5 billion, the most for a US listing by a foreign firm.
The company, a supplier of advanced memory chips to industry giant Nvidia, has seen profits skyrocket thanks to the global race to build artificial intelligence data centers.
Its Seoul-listed shares had surged almost 700 percent in the past 12 months to their peak on June 23, before being caught up in a global tech rout fueled by fears of overheated valuations and questions about when big investments will reap returns.
SK hynix along with Samsung and Micron are heavyweights in the global market for advanced components known as high-bandwidth memory (HBM), used in AI servers along with other semiconductors that store data.
Stephen Innes at SPI Asset Management said the fact the share sale was more than seven times oversubscribed “tells you everything you need to know about the current temperature of the market”.
“Investors are still desperate for anything related to AI infrastructure, especially if it sits near the edge of high-bandwidth memory.”
The Seoul Kospi jumped more than four percent at one point on Friday, although SK hynix was up just one percent, having added about five percent on Thursday. Samsung was four percent higher.
Tokyo also saw strong gains, with tech investment giant SoftBank gaining more than 10 percent, while Tokyo Electron and Advantest rose four percent.
Hong Kong, Shanghai, Singapore, Sydney and Jakarta joined the advances in early trade.
The mood on oil trading floors was also slightly less tense than earlier in the week, as investors became less concerned that the latest US-Iran flare-up over the Strait of Hormuz would reignite their war.
Both major crude contracts rose slightly on Friday, having fallen about two percent a day earlier, with analysts noting that more oil is being produced outside the Gulf region, softening the impact of the outages.
Thursday’s drop in prices “suggests that investors continue to view the recent escalation as a temporary setback rather than the start of a protracted conflict,” City Index’s Fiona Cincotta said.
“Oil prices are pulling back after Wednesday’s sharp rally, indicating that markets still expect diplomacy to eventually prevail and that any disruption to global energy supplies is likely to be limited.”
– Key figures around 0230 GMT –
Seoul – Kospi: UP 3.4 percent to 7539.56
Tokyo – Nikkei 225: UP 1.8 percent to 68,943.76 (interval)
Hong Kong – Hang Seng Index: UP 1.5 percent to 24,386.91
Shanghai – Composite: UP 0.5 percent to 4,055.00
Dollar/yen: DOWN at 161.43 yen from 162.38 yen on Thursday
Euro/dollar: UP at $1.1458 from $1.1430
Pound/dollar: UP at $1.3449 from $1.3410
Euro/pound: DOWN at 85.19 pence from 85.23 pence
West Texas Intermediate: UP 0.1 percent to $72.16 a barrel
Brent North Sea crude: up 0.1 percent at $76.35 a barrel
New York – Dow: UP 0.3 percent to 52,487.41 (close)
London – FTSE 100: DOWN 0.2 percent to 10,472.45 (close)
