Strong performance ignites chip enthusiasm, SK Hynix surges 8%, Korean stock market jumps 6%, Kioxia soars 10% leading the Nikkei Index
On Wednesday, the MSCI Asia Pacific Index rose by 0.8%, with South Korea's KOSPI leading the gains with an increase of over 6%. Strong earnings from SK Hynix drove a broad rally in semiconductor stocks. Kioxia surged by 10.43%, while Ibiden, Taiyo Yuden, Murata, Renesas, and other chip stocks also saw significant gains. The Reserve Bank of New Zealand unexpectedly paused its rate hikes, causing the New Zealand dollar to drop over 1% and record its largest single-day decline against the Australian dollar since 2017. Brent crude rebounded by 1.6%, while gold edged down slightly to around $4,045 per ounce.
Asia-Pacific stock markets extended the overnight rally from US stocks on Wednesday, as renewed enthusiasm for AI trading, combined with SK Hynix's strongest quarterly report ever, boosted the overall regional market higher. Investors are also awaiting directional signals from the upcoming Federal Reserve rate decision and major tech earnings reports.
On Wednesday, the MSCI Asia-Pacific Index rose 0.8%. The Korea Composite Stock Price Index (KOSPI) led gains, surging up to 6% intraday as SK Hynix's robust performance drove semiconductor stocks such as Samsung Electronics higher, rapidly heating up market sentiment. Japan’s Nikkei 225 Index gained over 1%, and Australia’s S&P/ASX 200 index climbed 0.8%.
In commodities, Brent crude oil rebounded sharply from two consecutive days of losses, rising 1.6%. Gold edged down 0.35%, with spot gold quoted at around $4,045 per ounce.
US Treasury yields saw little change, with the 10-year Treasury yield remaining near 5.00%. The US dollar index was nearly flat. Meanwhile, the Reserve Bank of New Zealand unexpectedly kept rates unchanged, causing the New Zealand dollar to drop more than 1%, with NZD/AUD recording its largest single-day decline since 2017.
SK Hynix Record-Breaking Earnings Lift Semiconductor Sector
On Wednesday, KOSPI surged 6%, prompting the Korea Exchange to activate the SIDECAR mechanism, suspending programmatic buying. The KOSPI200 Index’s gains approached 7% at one point.
Wallstreetcn cited that SK Hynix released its third-quarter results on Wednesday, with operating profit skyrocketing more than sevenfold year-on-year to 83.33 trillion KRW, far surpassing market expectations of 77.5 trillion KRW. Quarterly sales surpassed 100 trillion KRW for the first time, reaching 104.62 trillion KRW—a year-on-year increase of 328%.
The company simultaneously announced a shareholder return plan through 2026, totaling 100 trillion KRW (about $75 billion), with at least 30 trillion KRW in cash dividends and at least 60 trillion KRW in stock buybacks and cancellations.
The news continued to push SK Hynix’s share price higher and drove Samsung Electronics to rise more than 8% as well.
Counterpoint Research Director MS Hwang noted that SK Hynix’s results confirm the continued robust demand for AI hardware.
The renewed AI trading fervor also spilled over to Japanese stocks. Japanese chip and electronics hardware stocks soared across the board, with the semiconductor supply chain providing strong support for the Nikkei 225, which climbed more than 1%.
Memory chips and advanced packaging sectors showed the strongest breakout momentum. Flash memory giant Kioxia jumped 10.43% in a single day, semiconductor packaging substrate leader Ibiden surged 6.88%, and multilayer ceramic capacitor giants TAIYO YUDEN and Murata Manufacturing rallied strongly by 7.84% and 5.12% respectively. Automotive-grade chipmaker Renesas Electronics rose sharply by 6.29%, and chip design firm SOCionext also recorded a 4.59% gain.
Semiconductor equipment and upstream material supply chains also strengthened in sync. Wafer giant Shinkowa rose 5.46% in a single day, chip dicing equipment monopoly DISCO jumped 5.14%, and Japan’s largest semiconductor equipment giant Tokyo Electron climbed 4.71%. In addition, upstream electronic material supplier Mitsui Mining & Smelting achieved a sharp rise of 4.48%.
AI Trading Sentiment Warms, Institutions Optimistic on Recovery Potential
Prior to SK Hynix’s earnings release, market AI sentiment had already begun recovering this week. Previously, US chip stocks had undergone a significant correction in the past three to four months, but rebounded this week. On Tuesday, the Philadelphia Semiconductor Index surged 3.6% in a single day, lifting the Nasdaq Composite Index by 1.2%.
Morgan Stanley’s Chief US Equity Strategist Mike Wilson stated that signs of a recent rebound in tech stocks indicate the correction is nearing its end. He said:
Most of the correction is already over; we have been in a correction phase for four or five months... The market, in my view, has already digested all of this very efficiently.
JonesTrading Institutional Services Chief Market Strategist Michael O'Rourke also noted in a report:
A wave of AI news sparked a relief rally after three weeks of pressure. The related news reassured investors—large AI companies can and are continuing to advance spending, even as smaller firms face pressure.
The market will successively receive quarterly reports from Alphabet, Microsoft, and Amazon this week, with AI capital expenditure prospects set to be directly tested.
Reserve Bank of New Zealand Surprises with Hold, NZD Under Pressure
On Wednesday, the Reserve Bank of New Zealand decided, by a 4:3 vote, to keep the official cash rate unchanged, falling short of the widely expected 25 basis point rate hike.
After the decision was announced, NZD/USD dropped more than 1%, while NZD/AUD slid nearly 2% at one point, marking the largest single-day decline since 2017. New Zealand’s two-year government bond yield fell 12 basis points on the day.
According to meeting minutes, four members (Anna Breman, Carl Hansen, Prasanna Gai, Rebecca Williams) voted for no change, while three members (Paul Conway, Hayley Gourley, Karen Silk) voted in favor of a rate hike.
The statement indicated the committee unanimously believes it may still be necessary to tighten monetary policy in the future, but the pace will depend on the economic outlook. Persistently high refined oil prices and currency depreciation raise the risk of greater second-round effects on inflation.
Australia’s Q3 CPI data exceeded expectations, boosting the Australian dollar’s intraday gain to as much as 0.3%, with the exchange rate around $0.7045.
Reserve Bank of Australia Governor Bullock said in her speech that inflation may remain high for some time, global energy prices are well above August’s benchmark forecast, and upward price risks are gradually becoming reality. She said the central bank "cannot tolerate persistently high inflation," and the policy committee will discuss whether the level of tightening so far has been sufficient.
RBA Deputy Governor Hauser added that the Q3 CPI was stronger than the August outlook, that the inflation data is "too high," and he does not expect Australia to fall into recession.
In commodities, Brent crude oil rebounded sharply from two consecutive days of declines, rising 1.6% to about $111.17 per barrel.
Gold edged down 0.35%, with spot gold quoted at around $4,045 per ounce.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
You may also like
Morgan Stanley Quantitative Team: AI Chip Stocks Haven’t Bottomed Yet, Recommend “Reducing Positions on Rebounds”
Morgan Stanley’s quant team has warned that the sell-off in semiconductor and data center stocks is not over yet, as the current trend of the chip index resembles that of the internet bubble in 2000, indicating continued medium-term downside risk. They recommend taking advantage of rebounds to reduce positions, increase allocation to low-volatility and value stocks, and position in AI application companies. The report points out that the AI theme is shifting from upstream infrastructure to downstream applications, with AI adoption companies demonstrating relative resilience.
JPMorgan: If AI-driven profits persist, US stocks can withstand a 10-year Treasury yield rising to 5.5%-6.0%
JPMorgan pointed out that based on approximately 80 years of historical data, if the current forecast for forward EPS growth exceeding 20% is achieved, the S&P 500 has the capacity to absorb a rise in the 10-year U.S. Treasury yield to the 5.5%-6.0% range—especially under the premise that AI-driven productivity growth supports a high valuation environment.
