Shares of South Korea's SK Hynix surged nearly 13% on Wednesday, leading gains in the country's semiconductor sector after softer-than-expected U.S. inflation data boosted global technology stocks and renewed optimism over artificial intelligence-driven memory demand, Reuters reported.
The rally extended across the sector, with Samsung Electronics climbing nearly 8% and chip equipment maker Hanmi Semiconductor advancing about 25% in early trade.
The gains followed a strong overnight performance on Wall Street, where the S&P 500 and Nasdaq closed higher after cooler-than-expected U.S. inflation data and solid earnings from major banks improved investor sentiment despite ongoing geopolitical tensions in the Middle East.
The rebound comes after weeks of volatility in semiconductor stocks, as investors weighed concerns that memory earnings growth could slow with moderating price increases in the second half of 2026. Market participants have also questioned whether softer capital spending by major U.S. cloud providers, higher financing needs and aggressive capacity expansion plans by memory manufacturers could eventually ease the industry's supply-demand imbalance, Reuters said.
However, analysts continue to see strong structural demand from AI applications supporting the memory market. According to Reuters, Meritz Securities estimates that DRAM suppliers are currently meeting only about 75% to 80% of demand as shortages intensified in the second half of 2026. The brokerage expects fulfilment rates to deteriorate further in 2027, suggesting supply will remain well below demand even after excluding speculative orders.
Reuters also reported that HSBC expects improving profitability of AI services to sustain robust cloud spending, while the industry's shift toward three- to five-year supply agreements should improve earnings visibility and reduce volatility over the next few years.
Adding to the positive sentiment, Barclays initiated coverage of SK Hynix's newly listed American Depositary Receipts (ADRs) with an overweight rating and a price target of $330. The ADRs surged nearly 28% to $193.92 on Nasdaq on Tuesday.
Goldman Sachs said, according to Reuters, that the recent selloff in South Korean semiconductor stocks had been exacerbated by the unwinding of positions in newly launched exchange-traded funds concentrated in a handful of stocks, even as the underlying semiconductor cycle remained fundamentally strong.
Separately, Reuters reported last week that SK Hynix Chief Executive Kwak Noh-jung expects the global memory industry to face its worst-ever supply shortage in 2027, with demand likely to outstrip the company's production capacity well beyond 2030 despite aggressive expansion plans.
