Shares of SK Hynix came under renewed selling pressure in Tuesday’s trade, October 20, as sentiment toward the artificial intelligence trade remained jittery ahead of key earnings reports this week.
After a brief recovery in the previous session, the shares resumed their losing streak, crashing 4.23% in trade to their lowest level since April. The decline also dragged the Kospi Index down 4%, given SK Hynix’s significant weight in the index.
Adding to signs of pressure on the AI trade, data center infrastructure company Elice Inc. plunged as much as 33% in its trading debut in Seoul.
Meanwhile, SoftBank Group Corp.’s credit risk, as measured by its credit-default swaps, has risen to its highest level in nearly four years as concerns grow over AI-related funding and a potential large acquisition.
Chip stocks have been fluctuating between gains and losses lately but have largely tilted downward amid rising Chinese competition, tight NAND supply, expectations of higher interest rates, and concerns about the sustainability of AI infrastructure spending.
These stocks bled heavily last week, raising concerns about the AI trade after a runaway rally earlier this year. Still, Nvidia Corp. Chief Executive Officer Jensen Huang took a sanguine view, saying, “All of this is going to pass.” He encouraged investors to look beyond near-term reports and concentrate on the long-term value of the technology.
SK Hynix plunged 59% from peak
SK Hynix shares have remained lower for the last eight out last ten trading sessions, losing a cumulative 34% and dropped 31% in October so far.
The crash has brought the stock lower by 59% from its summer peak, reversing a significant portion of its earlier gains as one of Asia’s biggest beneficiaries of the AI memory boom.
Yet, the stock is still up 93%. At its peak, it had surged a whopping 358%. It has ended each of the past three calendar years in positive territory, including a 274% jump in 2025.
Although the stock has been under pressure since the start of the second half of the year, the sell-off accelerated after Chinese memory chipmaker ChangXin Memory Technologies (CXMT) reportedly made significant progress in a new memory-cell design aimed at increasing storage density.
The technology is also being pursued by major global memory makers, including Samsung Electronics, SK Hynix, and Micron Technology.
CXMT aims to introduce a new server-memory product based on the architecture by the end of 2026, company president Cao Kanyu said at an industry event in
Key earnings in focus
A revival in sentiment toward the AI trade will depend on upcoming earnings, with more than 70 S&P 500 companies due to report this week, including Magnificent Seven members Tesla Inc. and Meta Platforms Inc.
Netflix Inc. reports on Tuesday, followed by Tesla, Meta, and International Business Machines Corp. the following day. Some investors are betting that accelerating US inflation and tremors across the AI sector will amplify swings in tech shares and spill over into the broader market.
Disclaimer: We advise investors to check with certified experts before making any investment decisions.
