By Kwanwoo Jun
SK Hynix's red-hot shares slumped, after a South Korean regulator cautioned investors that the shares might be overheated following a recent rally.
The key supplier of high-bandwidth-memory products to Nvidia is benefiting from an artificial-intelligence boom. Its stock has more than tripled so far this year.
Shares of the South Korean memory-chip maker slid 5.5% to close at 586,000 won, equivalent to $409.80, on Tuesday, following an 11% surge on Monday. The latest plunge followed an overnight "investment caution" from Korea Exchange on SK Hynix's shares, a warning that remains valid for one day.
The warning could be raised to an "investment alert" or an "investment danger," which could limit the stock's trading depending on its volatility over the next two weeks, said the operator and regulator of the stock market.
SK Hynix's retreat came as the benchmark Kospi snapped a four-session winning streak, with some traders taking profit after recent gains.
The index closed 2.4% lower on Tuesday, paring its year-to-date gains to 72%--outperforming many regional peers but paling in comparison to SK Hynix's stellar gains.
South Korea's major semiconductor companies, especially SK Hynix, are getting a boost from Nvidia's recent South Korean deals.
Nvidia forged deals with Seoul as well as big Korean tech companies--including SK Group, the parent of SK Hynix--on Friday in South Korea. Under the agreements, 260,000 of Nvidia's new AI chips will be deployed in data centers, smart factories, autonomous vehicles and robotics across the country.
Write to Kwanwoo Jun at kwanwoo.jun@wsj.com
(END) Dow Jones Newswires
11-04-25 0322ET
