Samsung Electronics (005930.KS) and SK hynix (000660.KS) posted their steepest weekly share price declines since the 2008 global financial crisis, as heavy foreign selling concentrated on large-cap semiconductor stocks dragged the shares lower. Analysts are divided over what comes next, with some expecting a rebound driven by solid earnings and others warning that caution over artificial intelligence spending will keep volatility elevated.
Samsung Electronics shares fell 17.8% last week, from Oct. 12 to Oct. 16, to 215,500 won from 262,000 won, according to the Korea Exchange on the 19th. SK hynix plunged 24.3% to 1.272 million won from 1.681 million won. For Samsung Electronics, it was the sharpest weekly drop since the fourth week of October 2008, when the stock fell 19.3%. For SK hynix, it was the worst since the third week of November 2008, when it lost 31.9%.
Foreign selling drove the decline. Overseas investors dumped 11.2068 trillion won ($7.8 billion) worth of shares on the KOSPI last week, including net sales of 3.4763 trillion won in Samsung Electronics and 5.3565 trillion won in SK hynix. The two companies accounted for 78.8% of total foreign net selling on the main board. The sustained outflows pushed foreign ownership of Samsung Electronics down to 45.98% on the 16th, the lowest since July 2009. SK hynix stood at 48.85%, its lowest level since December 2021.
Analysts disagree on where the market heads from here. Some point to the chipmakers' solid earnings fundamentals, noting that profit forecasts for Samsung Electronics and SK hynix have been revised upward recently. ASML said in its latest earnings release that customers' medium- to long-term demand outlook is improving, while market research firm TrendForce projected a double-digit percentage increase in DRAM prices in the fourth quarter. On that basis, some analysts expect earnings at the KOSPI's two largest companies to stay strong and lift the domestic market in a W-shaped recovery.
Others say it is too early to read the market's gain on the 16th as a trend reversal, citing a rebound weaker than the previous day's plunge and no confirmation that foreign buying will last. Samsung Electronics and SK hynix rose as much as about 5% intraday that day but lost momentum late in the session, closing up 2.62% and 0.79%, respectively. Foreign net buying was also limited compared with daily net selling that had approached 2 trillion won on average this month.
"Caution over AI credit risk has spread across the market," an industry official said. "Earnings releases from companies in the AI value chain, such as Meta and Lam Research, will be a turning point for gauging where the market goes."
