South Korean chipmakers Samsung Electronics Co. and SK hynix Inc. saw their stocks gain ground on Wednesday morning, driven by strong performance in U.S. semiconductor stocks overnight. Samsung Electronics opened at 243,500 won, up 1.67 percent, and quickly extended its gains, trading at 249,000 won ($176.31) as of 9:18 a.m., marking a 3.97 percent rise from the previous session. The gain later widened to more than 4 percent. Similarly, shares of SK hynix were trading 2.18 percent higher at 1.455 million won, with its gains expanding to more than 3 percent later in the session. SK hynix opened at 1.456 million won, up 2.18 percent, and fluctuated as investors sought direction.
The surge in Korean chip stocks came despite the three major U.S. stock indexes closing lower overnight. However, strength in semiconductor stocks, which pushed the Philadelphia Semiconductor Index up 0.87 percent, appeared to carry over into the Korean market. While Big Tech stocks posted losses, with Alphabet Inc., Google LLC’s parent company, down 3.84 percent, Amazon.com Inc., down 2.09 percent, and Microsoft Corp., down 0.44 percent, specific chipmakers like Micron Technology Inc. rose 0.87 percent, Sandisk Corp. gained 2.68 percent, and Seagate Technology Holdings plc advanced 2.44 percent. Shares of Nvidia Corp., which has opposed regulations on open-source artificial intelligence (AI), slipped 0.02 percent after the company unveiled its own lightweight AI model and established a $500 billion AI infrastructure financing platform with major Wall Street investors, as mixed market interpretations led to volatile trading. SK hynix’s American depositary receipt (ADR) also surged 4.7 percent, attributed in part to growing expectations that the company will expand its market dominance in the NAND business following news that it has become the largest indirect shareholder of Japan’s Kioxia Corp. and that its subsidiary Solidigm has resumed capital investment in China.
Investor activity on the Kospi market revealed a clear divergence, as foreign investors were the sole net buyers, purchasing a net 141.9 billion won worth of shares. In contrast, retail and institutional investors were net sellers of 59.1 billion won and 74.2 billion won, respectively. This trend was pronounced in the electrical and electronics sector, which includes Samsung Electronics and SK hynix, where foreign investors were net buyers of 104.2 billion won, while retail and institutional investors were net sellers of 70.4 billion won and 32.8 billion won, respectively.
Related: Korean Chipmakers Fall on US Market Slump
Separately, shares of Iljin Electric Co., a power equipment manufacturer, surged in early trading, buoyed by its second-quarter earnings that exceeded market expectations. The stock jumped 16.02 percent at the open and continued to post gains of more than 10 percent in early trading, trading at 73,200 won as of 9:04 a.m., up 18.45 percent. The shares had also surged by more than 10 percent in the after-hours market on Tuesday. Iljin Electric said on Tuesday that its operating profit for the second quarter rose 91 percent from a year earlier to 72 billion won, while revenue increased 22 percent to 637.4 billion won over the same period. These figures marked Iljin Electric’s best-ever second-quarter results, and the company also posted record first-half results this year, with revenue of 1.14 trillion won and operating profit of 122.7 billion won.
Lee Min-jae, an analyst at NH Investment & Securities Co., noted that “The second-quarter results exceeded consensus estimates.” Lee maintained his “Buy” rating, citing expectations for improved profitability from a higher share of North American sales over the medium to long term and increased demand for transformers and power cables as Korea’s three major mega-projects move into full swing. However, Lee lowered his target price from 118,000 won to 108,000 won, saying the revision reflected an increase in the cost of equity due to higher interest rates.
JW Pharmaceutical Corp. saw its shares surge on Wednesday morning following news that its gout treatment candidate demonstrated efficacy in a multinational Phase 3 clinical trial. JW Pharmaceutical shares were trading at 30,750 won as of 9:03 a.m., up 17.14 percent from the previous session. JW Pharmaceutical’s preferred shares were also up 9.09 percent, while shares of its holding company, JW Holdings Ltd., rose 13.92 percent. The gains appeared to follow JW Pharmaceutical’s announcement on Tuesday that its gout treatment candidate, epaminurad, had demonstrated efficacy in a multinational Phase 3 clinical trial and that the company plans to apply for regulatory approval in Korea. At 6 mg, the primary dose being developed, epaminurad showed a greater uric acid-lowering effect in the blood than febuxostat, the existing standard treatment. Epaminurad is an oral uricosuric agent that selectively inhibits human urate transporter 1 (hURAT1), suppressing the reabsorption of uric acid in the kidneys and promoting its excretion. By the close of the session, shares of Samsung Electronics finished at 255,500 won, SK hynix at 1,504,000 won, Iljin Electric at 72,500 won, and JW Pharmaceutical at 30,000 won.
