Samsung Electronics, SK hynix stocks gain on U.S. chip frenzy

[Graphics by Song Ji-yoon]

The stocks of South Korea’s Samsung Electronics Co. and SK hynix Inc. gained sharply on Thursday, boosted by the strong performance of semiconductor stocks in the United States.

Shares of Samsung Electronics were trading at 78,500 won as of 11:12 a.m. on Thursday, up 2.61 percent from the previous session. Shares of SK hynix increased 3.72 percent to 223,000 won.

Samsung Electronics stock opened 2.48 percent higher and SK hynix 5.12 percent higher after gaining 1.73 percent and 1.18 percent, respectively, on Wednesday.

The gains are attributed to the strong chip stock performance in the U.S.

Shares of Nvidia Corp. closed 3.55 percent higher overnight while those of Broadcom Inc. 2.36 percent, Micron Technology Inc. 4.21 percent, and Advanced Micro Devices Inc. (AMD) 8.11 percent.

The Philadelphia Semiconductor Index also rose by 2.9 percent on Wednesday.

The U.S. Federal Reserve lowered its projection for rate cuts this year from three times to once at the Federal Open Market Committee (FOMC) meeting but its Chairman Jerome Powell eased market concerns by saying that it “stands ready to respond at any time if inflation slows faster than we expect.”

The U.S. Department of Labor’s May consumer price index (CPI) also showed a slowdown compared to April, bringing some relief to the market.

The stock prices of companies that own shares in Pohang Yeongilman Port soared on Thursday, following the news that the government is planning to expand the port in response to potential oil and gas deposits off the east coast.

Shares of DL E&C Co. were up 17.5 percent to 20,750 won as of 11:16 a.m. on Thursday, while those of Kolon Global Corp. rose 29.73 percent to 22,300 won.

DL E&C owns 29.5 percent stake in Pohang Youngil New Port Corp. and Kolon Global 15.34 percent.

In a separate development, Nongshim Co. saw its shares hit a 52-week high on Thursday, driven by expectations for mid- to long-term growth on the back of the construction of a new logistics center.

Nongshim shares were trading at 563,000 won ($410.1) as of 11:17 a.m. on Thursday, up 3.49 percent from the previous session.

The Korean instant noodle maker announced after market close on Wednesday that it plans to build a five-story building with a total floor area of 165,289 square meters in Ulsan, North Gyeongsang Province, with an investment of 229 billion won.

Nongshim said that the investment is intended to “strengthen its logistics competitiveness as it expands its domestic and export markets.”