AI Chip Demand Sends Samsung, SK Hynix Shares Soaring as KOSPI Hits Record High

SK Hynix and Samsung Electronics produce roughly two-thirds of the world’s memory chips and are central to the high-bandwidth memory supply chain powering AI servers. Their heavy weighting in South Korea’s Kospi makes the benchmark unusually sensitive to shifts in the AI trade. Volatility has also been amplified since regulators approved 16 single-stock leveraged exchange-traded funds tied to the two companies in late May.

The Kospi closed 10.84% lower at 6,023.66 on July 28, prompting the Korea Exchange to impose a 20-minute marketwide halt. SK Hynix sank 14.7% and Samsung Electronics lost 13.4%. An attempted rebound failed on July 29, when the benchmark fell about 7.5% intraday as SK Hynix and Samsung dropped nearly 13% and 8%, respectively. The renewed selling reflected concerns over AI infrastructure financing, rising Chinese competition and leverage-driven fund outflows.

SK hynix sits at the center of the artificial-intelligence hardware boom as demand for high-bandwidth memory, or HBM, expands alongside investment in AI servers and data centers. That exposure has made the chipmaker a bellwether for South Korea’s technology sector. A recent wave of leveraged position unwinding had intensified losses across semiconductor shares, leaving investors focused on when forced selling would subside and whether capital would return to the AI supply chain.

Sentiment improved as investors judged the market’s deleveraging cycle to be nearing an end and SK Group Chairman Chey Tae-won increased his holding in SK hynix. The move was viewed as a vote of confidence in the memory-chip maker and the broader AI investment cycle, helping drive the KOSPI up more than 16%. The report did not disclose the stake size, transaction value or exact purchase date, while analysts said AI infrastructure spending remained supportive of semiconductor demand.

South Korea’s equity market is heavily influenced by Samsung Electronics and SK Hynix, making the semiconductor cycle and foreign investor sentiment central to the KOSPI’s direction. Moody’s said second-quarter economic growth may slow, adding to concerns over the broader outlook. Still, AI-driven semiconductor exports remain a key source of support for the trade-dependent economy and a potential counterweight to weaker domestic momentum.

The KOSPI plunged 5% on July 20 as Samsung Electronics and SK Hynix led declines. Morgan Stanley cut its bearish-case target to 6,000 points, while Citi and Goldman Sachs also issued cautious assessments the same day. The selloff contrasted with longer-term industry optimism: SK Hynix’s chairman forecast that global demand for AI chips will surge 60% to 100% next year.

Explosive growth in global demand for AI chips and high-bandwidth memory is making South Korea’s semiconductor industry increasingly strategic to the global supply chain. Chailease Securities Investment Advisory said the South Korean government’s push for special semiconductor legislation and stock-market reforms is providing policy benefits to the country’s technology giants. The industry shift is reshaping the global technology supply chain and offers investors an important avenue into the long-term AI trend, drawing market attention to the medium- and long-term prospects for South Korean equities.

In its latest assessment released in July 2026, Chailease Securities Investment Advisory said South Korean chip leaders SK hynix and Samsung Electronics have strong medium- and long-term growth momentum as they benefit from the AI chip boom. With the government rolling out a 26 trillion won semiconductor support plan and recently stepping up efforts to advance special legislation, the firm advised investors to build positions gradually through regular fixed-amount investments or by adding holdings on market declines to capture the long-term trend.

SK Hynix is a major supplier of high-bandwidth memory (HBM) to AI chipmakers including NVIDIA. The expansion of AI data centers by Microsoft, Google and Meta has driven up memory demand and prices. As of 2025, SK Hynix held 61% of the global HBM market, far ahead of Samsung Electronics’ 17%, making it a key force reshaping South Korea’s semiconductor industry.

SK Hynix shares closed 5.6% higher on June 22, 2026, lifting its market capitalization to 2,080.4 trillion won, or about $1.35 trillion. That surpassed Samsung Electronics’ 2,066.7 trillion won valuation excluding preferred shares, ending Samsung’s reign as South Korea’s most valuable company since 2000. SK Hynix also plans to issue about $27 billion of American depositary receipts on Nasdaq as early as mid-to-late July.

Surging demand for high-bandwidth memory (HBM) used in AI servers and accelerators has boosted profits and employee bonuses at Samsung Electronics and SK Hynix. SK Hynix has allocated 10% of operating profit to bonuses since September 2025, while Samsung Electronics agreed in a May 2026 labor-management deal to allocate 10.5% of its semiconductor division’s operating profit, putting tech-sector compensation at the center of wage negotiations and consumer spending nationwide.

In a price stability report released on June 17, 2026, the Bank of Korea said special bonuses in the IT sector rose 60.6% year on year in the first quarter, while wages in other industries increased just 2.1%. The growing share of companies paying large bonuses could lift the consumer price index by 0.05 percentage points after about five months. A memory-chip employee earning an annual salary of 80 million won could receive an estimated bonus of about 626 million won, while bonuses for SK Hynix employees could exceed 700 million won.

The expansion of AI data centers has fueled memory-chip demand, making Samsung Electronics and SK Hynix the main engines of South Korea's stock market. Together, the companies account for 54% of the KOSPI's market capitalization and nearly three-quarters of its gains this year. That has left South Korea's $4.9 trillion stock market highly concentrated, with both the index and leveraged retail-investor positions at risk if AI capital spending cools.

As of June 4, 2026, the KOSPI had risen more than 100% for the year, but it plunged as much as 7% intraday on June 5. Foreign investors have sold a net 15.8 trillion won since the start of June. The Korea Financial Investment Association said margin-financing balances hit a record 38 trillion won on May 29. Although Goldman Sachs raised its index target to 12,000 from 9,000, the market still faces a liquidity test from a potential Bank of Korea interest-rate increase in July.

The global expansion of investment in generative AI has boosted demand for memory chips and advanced semiconductors, making South Korea, home to supply-chain leaders such as Samsung Electronics and SK hynix, a major beneficiary. The long-standing “Korea discount,” driven by weak corporate governance and low shareholder returns, has also begun to narrow as the government pursues reforms.

As of July 2026, the KOSPI had risen 100% for the year and reached another record, led by technology stocks including SK hynix. South Korea’s total stock-market capitalization climbed to $3.76 trillion, overtaking Germany and France in succession to rank ninth globally. President Lee Jae Myung’s administration is also advancing corporate governance reforms, further strengthening investor confidence.

Demand for Nvidia's AI accelerators drives orders for high-bandwidth memory, or HBM. Samsung Electronics and SK hynix together account for nearly half of the KOSPI's market capitalization, magnifying the impact of Nvidia's outlook on South Korean stocks. Samsung's labor dispute also involved 45,000 union members and threatened semiconductor output, making the removal of strike risk another major catalyst for investors betting on the AI supply chain.

After the market closed on May 20, 2026, Nvidia reported FY2027 first-quarter revenue of $81.6 billion, up 85% from a year earlier and above the $79.2 billion market estimate. It issued second-quarter guidance of $91 billion. On May 21, Samsung reached an agreement with labor on an average 6.2% pay increase and called off the strike. The KOSPI closed 8.42% higher at 7,815.59, with Samsung Electronics up 8.51% and SK hynix gaining 11.17%, prompting the Korea Exchange to activate a buy-side sidecar.

Generative AI is driving data-center expansion, making high-bandwidth memory, or HBM, a critical GPU component. Young South Korean investors are consequently shifting funds from cryptocurrencies into Samsung Electronics and SK hynix, betting on the companies’ positions in the global memory supply chain. The trend echoes Taiwanese investors’ longstanding enthusiasm for holding TSMC shares.

HBM demand has climbed rapidly in recent months, channeling market funds into Samsung Electronics and SK hynix and driving significant gains in both companies’ shares. The Korea Exchange’s KOSPI also surpassed 6,000 points for the first time, propelled by the AI chip rally and reflecting a clear shift among South Korean retail investors toward the AI hardware supply chain.