Shares of Samsung Electronics and SK Hynix fell more than 10% in pre-market trading as concerns about reduced investments in artificial intelligence (AI) spread through the semiconductor sector.
As of 8:09 a.m. on November 6, Samsung Electronics was trading at 179,500 won, down 22,000 won (10.92%) from the previous trading day. SK Hynix saw a decline of 16,100 won (12.74%), trading at 1,103,000 won.
The sharp drop in domestic semiconductor stocks is attributed to a sell-off in AI and semiconductor-related stocks on the U.S. stock market the previous night.
On November 5, the Nasdaq Composite Index closed down 1,421.52 points (5.52%) at 24,315.00. The Dow Jones Industrial Average fell 1,833.06 points (3.44%) to finish at 51,523.06, while the S&P 500 dropped 334.89 points (4.36%) to close at 7,353.73.
Notably, Micron, a memory semiconductor company, plummeted by 17.46%, while Nvidia and AMD fell by 9.26% and 17.26%, respectively. Concerns about reduced AI investments were exacerbated by disappointing earnings forecasts from Qualcomm and ARM, along with news of Micron halting construction of its factory in Taiwan.
Worries that data center regulations may tighten under a Democratic-led Congress following the midterm elections have also dampened investor sentiment. Analysts suggest that restrictions on new data center projects could slow the investment cycle for AI infrastructure, leading to broader sell-offs in semiconductor stocks.
Han Ji-young, a researcher at Kiwoom Securities, stated, "The Philadelphia Semiconductor Index dropped 12.25% due to fears of reduced AI investments stemming from data center regulations, and the KOSPI 200 futures fell over 7% in after-hours trading. We expect increased volatility in the market as trading progresses today."
However, Han advised against joining the sell-off of AI-related stocks at this time, emphasizing the need to monitor major companies' investment plans and the earnings outlook for semiconductor firms. "We should observe whether U.S. hyperscaler companies will change their capital expenditure plans in the U.S. and abroad, as well as any downward adjustments to the 2028 consensus for domestic and international semiconductor stocks, and respond cautiously," he added.
* This article has been translated by AI.
Copyright ⓒ Aju Press All rights reserved.