As the U.S.-China summit approaches, interest in beneficiary stocks is intensifying. The focus of this major diplomatic event, the first in 11 years, is the escalating rivalry between the U.S. and China over artificial intelligence (AI) industry dominance. U.S. President Donald Trump has hinted at pressure regarding China's theft of AI technology, leading to expectations that South Korea's semiconductor and materials stocks, deeply involved in the U.S.-China semiconductor supply chain, will benefit in the medium to long term.
On September 21, the Korea Exchange reported that the KOSPI closed at 7,007.72 points, up 1.65% (113.49 points) from the previous trading day. This marks the first time the KOSPI has reclaimed the 7,000-point level since September 10 (7,033.92). Despite individual investors selling 2.979 trillion won and foreign investors offloading 171.9 billion won, institutional investors purchased 1.4924 trillion won, with financial investments at 1.2471 trillion won and other corporations buying 1.6585 trillion won, driving the index higher.
On this day, semiconductor and materials stocks showed strength amid expectations of improved memory market conditions and increased regulations on AI in China. In the main market, Samsung Electronics rose 4.98% (13,000 won) to close at 274,000 won, while SK Hynix, a leader in high-bandwidth memory (HBM), increased by 0.59% to finish at 1,868,000 won. Hanmi Semiconductor, classified under HBM and semiconductor backend processes, closed up 0.21% at 236,500 won.
The KOSDAQ market also saw gains among materials companies. With the U.S.-China AI competition potentially driving explosive demand for semiconductors and increased capital investment, companies involved in front-end and back-end equipment are likely to benefit. EoTechnics, which specializes in laser equipment and advanced HBM packaging technology, surged 6.73% (30,500 won) to close at 484,000 won. AI accelerator firm ISC rose 6.87% (12,800 won) to finish at 199,100 won, while HPSP, a company focused on removing wafer defects, increased by 1.48% (800 won) to close at 54,700 won.
Solbrain, classified as a materials stock, also saw a rise of 3.02% (10,000 won) to close at 341,000 won, while Dongjin Semichem increased by 3.28% (1,350 won) to finish at 42,550 won.
This summit is expected to be a catalyst for a long-term rally, given its significance in the U.S.-China AI rivalry. Chinese AI companies, such as DeepMind, have employed a 'fast follower' strategy by mimicking U.S. AI technologies through open-weight models. The U.S. views this as 'distillation'—a form of technology theft—and is hastening regulations on Chinese AI. U.S. Treasury Secretary Scott Vessenet indicated that discussions on this topic will be a key agenda item in high-level negotiations before the summit.
Regulations on Chinese semiconductors are directly linked to the exports of Samsung Electronics and SK Hynix, which support the domestic stock market. Depending on the summit's outcomes, the establishment of stringent U.S. distillation regulations could create a favorable environment for South Korean semiconductor exports. If China falls behind in the frontier AI development race, especially with restrictions on advanced semiconductors and computing access, the current technological gap may become entrenched. Analysts believe that if the Chinese government increases related investments, South Korea, which dominates the AI semiconductor value chain, will be in a favorable position.
Na Jeong-hwan, a researcher at NH Investment & Securities, stated, "If China's path to developing AI models using U.S. technology at a lower cost is blocked, demand for HBM, GPUs, and AI accelerators within China will explode, creating a favorable export environment across the entire supply chain for Korean AI memory, HBM equipment, and backend processes."
* This article has been translated by AI.
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