By Heekyong Yang
SEOUL, July 15 (Reuters) - Shares in SK Hynix jumped nearly 13% in Seoul on Wednesday, tracking gains in U.S. tech stocks after softer-than-expected U.S. inflation data, while upbeat analyst views on the outlook for AI memory demand also supported sentiment.
The rally lifted other South Korean semiconductor stocks, with Samsung Electronics rising nearly 8%, while chip equipment maker Hanmi Semiconductor gained about 25% in early trade.
The S&P 500 and the Nasdaq advanced on Tuesday
as solid big bank results and a cooler-than-expected inflation report boosted risk appetite amid rising Middle East tensions.
The gains came after weeks of volatility in chip stocks, as investors grappled with concerns over a potential slowdown in memory earnings growth as quarterly price increases moderate in the second half of 2026.
They have also questioned whether signs of slowing capital spending by major U.S. cloud service providers, rising financing needs and recent multi-billion-dollar capacity expansion plans by memory makers could eventually ease the industry’s supply-demand imbalance that has fuelled the chip stock rally.
However, some analysts remain optimistic that structural demand from AI applications will keep the market tight.
Kim Sunwoo, a senior analyst at Meritz Securities, said suppliers of DRAM chips, used for memory in computers, servers and mobile devices, were currently meeting only about 75% to 80% of demand as shortages intensified in the second half of 2026.
That fulfilment rate could fall to the 60% range in 2027, Kim said, adding that suppliers would still be able to meet only around 70% of demand even after excluding more speculative orders.
"With supply shortages set to deepen, memory prices and earnings are likely to continue improving, supporting a strong rebound in the share price," Kim said.
Echoing that view, HSBC said in a recent note that improving profitability of AI services should continue to underpin strong cloud spending.
The brokerage also said the industry's shift toward three- to five-year long-term supply agreements should improve earnings visibility over the next two to three years and reduce earnings volatility.
Barclays added to the positive sentiment, initiating research coverage on SK Hynix's newly listed American Depositary Receipts (ADRs) with an "overweight" rating and a $330 price target. The ADRs surged nearly 28% to $193.92 on Nasdaq on Tuesday.
Goldman Sachs said in a recent note the selloff in South Korean chip stocks had been amplified by the unwinding of positions in newly launched exchange-traded funds that are heavily skewed to one or two stocks, while the underlying semiconductor cycle remained fundamentally robust.
Reuters reported last week that SK Hynix Chief Executive Kwak Noh-jung expected the global memory industry to face its worst-ever supply shortage in 2027, with demand continuing to exceed the company’s production capacity well beyond 2030 despite aggressive expansion.
(Reporting by Heekyong Yang; Editing by Jamie Freed and Sonali Paul)
