▲AI PRISM* Customized Economic Briefing
*Editor's Note: 'AI PRISM' (Personalized Report & Insight Summarizing Media) is an "AI-based personalized news recommendation and summarization service" developed with support from the Korea Press Foundation. It selects and provides six customized news items by reader type.
[Key Issue Briefing]
■ AI Chip Jackpot: Samsung Electronics and SK hynix have signed a series of AI chip supply contracts totaling $950 billion (about 1,390 trillion won) with global big tech firms including Broadcom, Nvidia, and Microsoft (MS). As memory supply contracts, previously on a one-year basis, shift to long-term agreements (LTAs) of five years or more, the two companies are positioning themselves as key partners in global AI infrastructure.
■ Quantum Computing Correction: Quantum computing-themed ETFs, which posted the highest returns among newly launched ETFs last year, have plunged by as much as 32% over the past month. Products that adopted a "pure play" strategy of concentrated investment in specific stocks saw steeper declines, while products that diversified their holdings held up relatively well.
■ Fund Flows: This month, Korean investors' net purchases of U.S. stocks rose to four times the previous month's level, with buying concentrated in leveraged exchange-traded funds (ETFs). Amid heightened volatility in the domestic stock market, Korean retail investors are both expanding overseas investment and channeling funds into domestically listed ETFs tracking U.S. indices.
[News of Interest to Financial Product Investors]
1. Samsung Partners on $200 Billion AI Chip Production… SK Expands HBM4 Supply to MS
- Key Summary: Samsung Electronics (005930) signed a memorandum of understanding (MOU) with Broadcom worth $200 billion (about 290 trillion won) through 2030, a major contract spanning high-bandwidth memory (HBM) supply and sub-2-nanometer (nm) foundry (contract manufacturing) production. SK hynix (000660) also signed a five-year contract with Nvidia that includes the supply of next-generation memory such as HBM4, followed by a total of $750 billion in cooperation with Microsoft (MS) and others. As a result, the total scale of cooperation signed by the two companies reaches $950 billion (about 1,390 trillion won), and memory supply contracts have shifted from the previous one-year basis to long-term agreements (LTAs) of five years or more. Samsung Electronics Chairman Jay Y. Lee is also reported to have met with OpenAI CEO Sam Altman to discuss ways to expand foundry orders.
2. Last Year's No. 1 Quantum Computing Plunges… Pure-Play Strategy Divides Fortunes
- Key Summary: Quantum computing products, which recorded the highest returns among newly listed ETFs last year, plunged by as much as 32.00% over the past month. "SOL U.S. Quantum Computing TOP10" surged 188.08% last year to top the return rankings, but its one-month return of -32.00% marked the steepest decline. In contrast, "RISE U.S. Quantum Computing" and "KIWOOM U.S. Quantum Computing," which diversified their investment targets to include big tech, semiconductor, and cloud companies, saw relatively smaller declines. An asset management official noted that some quantum computing-related stocks have a strong theme-stock character, being more sensitive to short-term supply and demand than to earnings.
3. Comprehensive Real Estate Tax Base to Change From 'Number of Homes' to 'Combined Value'
- Key Summary: The government is reviewing a plan to shift the comprehensive real estate tax base from the number of homes owned to the combined value of homes. The heavy taxation system with a top rate of 5.0% applied to owners of three or more homes is expected to be abolished or integrated into the base rate, while reduced deductions or additional tax will be applied to multi-home, non-resident, and speculative holdings. As a result, even single-home households owning ultra-high-priced homes may face increased tax burdens, while the basic deduction for single-home owners will be slightly raised from the current 12 billion won, and the threshold for the ultra-high-price bracket is being discussed at an official price of 3 billion to 4 billion won. The government plans to hold a national public debate on real estate policy on the 27th and include the final proposal in a tax law amendment early next month.
[Reference News for Financial Product Investors]
4. NPLs Surge but Provisions Rise Just 2%… "Concerns Over Distress Spreading to Banks"
- Key Summary: The balance of non-performing loans (NPLs), or loans overdue by three months or more, at the four major banks stood at 5.6444 trillion won at the end of June this year, up 24.1% from the end of last year. In contrast, loan loss provisions over the same period rose just 1.9%, from 7.7822 trillion won to 7.9316 trillion won, causing the NPL coverage ratio to fall 26.0 percentage points from 172.0% to 146.0%. With delinquency rates particularly high in vulnerable sectors such as regional small and medium-sized construction, lodging, and dining, concerns are also emerging that interest burdens could grow further as the Bank of Korea considers an additional base rate hike next month. The yield on three-year government bonds rose to 3.959% on the 24th of this month, the highest level since November 2023.
5. Korean Retail Investors Return to U.S. Market, Net Buying Quadruples This Month
- Key Summary: From the 1st to the 24th of this month, Korean investors' net purchases of U.S. stocks reached $2.59602 billion (about 3.7982 trillion won), four times the previous month's $632.96 million. Some interpret this as a sign that individual investors' departure from the domestic stock market has resumed in earnest amid heightened volatility. The top net purchase was the "Direxion Semiconductor 3x ETF," which tracks the Philadelphia Semiconductor Index at three times leverage, followed by SK hynix's American depositary receipts (ADRs) and the "Direxion MSCI Korea 3x ETF." Meanwhile, funds also flowed into domestically listed ETFs tracking U.S. indices, with "TIGER U.S. S&P500" recording net inflows of 221.4 billion won last week, the largest inflow.
6. To Get 80% RIA Capital Gains Reduction… Sell U.S. Stocks by the 29th
- Key Summary: To receive the 80% deduction on overseas stock capital gains through a Return-to-Domestic-Market Account (RIA), sell orders must be placed by the 29th of this month for settlement to be completed before the 31st. The Financial Supervisory Service (FSS) advised that the deduction rate is determined by the sale settlement completion date rather than the sale order execution date, and that after the end of this month the deduction rate will be reduced to 50%. Eligible for the deduction are overseas stocks acquired by December 23 last year, and the benefit is maintained only if the sale proceeds are invested in domestically listed stocks or ETFs for at least one year. The FSS also urged investors to check product prospectuses before subscribing, as integrated management accounts (IMAs) and specified money trust ETFs may incur additional costs such as sales and performance fees or trust commissions.
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