HBM Rivalry Shifts as Samsung Gains and SK hynix Slides

* Editor's note: AI PRISM (Personalized Report & Insight Summarizing Media) is an artificial intelligence-based personalized news recommendation and summary service developed with support from the Korea Press Foundation. It selects and provides six customized news items for each reader type.

1. HBM4 Shifts the Landscape as Outlooks Diverge for Samsung Electronics and SK hynix

- Key points: Short-term share performance has diverged between Samsung Electronics and SK hynix, and brokerages are adjusting their outlooks in line with shifts in the two companies' HBM competitiveness. Over the past month, Samsung Electronics rose 1.18%, outpacing the KOSPI's 0.49% gain, while SK hynix fell 8.98%. Foreign investors sold a net 5.9805 trillion won of SK hynix shares over the same period. LS Securities (078020) raised its target price for Samsung Electronics by 12.5% to 450,000 won from 400,000 won, while cutting its target for SK hynix by 27.3% to 2.4 million won from 3.3 million won. Jung Woo-sung, an analyst at LS Securities, said the downgrade reflects a normalization of competition among suppliers rather than a slowdown in HBM market growth.

2. Interest Rates Approaching a Threshold

- Key points: Market interest rates in both Korea and the United States have risen to levels that weigh on equity markets and capital investment, yet a turn toward lower and more stable rates is not easily in sight. In the Bank of Korea's revised economic outlook released on Aug. 27, growth forecasts for next year as well as this year were revised to levels above the potential growth rate, strengthening the case for a hawkish stance. Another factor is the possibility of a further widening in the term premium, which has recently played a larger role than monetary policy in driving market rates. With the government shifting to fiscal expansion and increasing bond issuance, market concerns over rising bond supply are unlikely to be dispelled.

3. Foreign Investors Retreat and Trading Value Hits Yearly Low as Rate-Sensitive Biotech and Brokerage Shares Take a Hit

- Key points: Rate-sensitive pharmaceutical, biotech and brokerage shares were hit as the likelihood of a U.S. rate hike in September increased. On the 31st, the KOSPI closed 0.46% higher at 6,820.02, while the KOSDAQ ended 0.49% lower at 834.29, with Alteogen (196170) and ABL Bio (298380) among the decliners. Average daily trading value in August was 25.7531 trillion won, roughly half the 50.3471 trillion won recorded in June this year, while investor deposits fell by more than 30 trillion won in two months from 132.4696 trillion won at the end of June. Since Federal Reserve Chair Kevin Warsh's remarks at Jackson Hole, the probability of a September rate hike has surged to 59.7% from around 35%.

4. Second Memory Squeeze Driven by LTAs Sends HBM and DRAM Prices Surging Again

- Key points: Memory chip prices are surging again as HBM4 destined for global big tech firms' artificial intelligence data centers begins shipping in earnest. According to the Korea International Trade Association, the average export price per HBM unit stood at $76.13 as of the end of July, up 9.5% from the previous month and surpassing $70 for the first time. The average HBM export price rose about 47% from $40.94 in the first quarter to $60.22 in the second, while conventional DRAM also faced shortages, with its average export price jumping 24.3% to $22.9 in July. Samsung Electronics is reviewing a conversion of foundry lines at its Pyeongtaek campus to memory production, and SK Group Chairman Chey Tae-won disclosed that SK hynix is considering building a semiconductor plant in Japan.

5. Long-Term Retirement Fund Investors Return to U.S. Equities

- Key points: Customers of defined contribution (DC) plans and individual retirement pensions (IRP) again bought U.S. index ETFs most heavily in August, marking a second consecutive month at the top of net purchases after July. An analysis of 85,172 retirement fund customers, commissioned by The Seoul Economic Daily from a major brokerage, found that 80% of the top five net-purchased products were U.S. index ETFs. TIGER U.S. S&P500 ranked first at 89.4 billion won, while KODEX AI Semiconductor TOP2 Plus was the only domestic equity product included, at 18.8 billion won. Cumulative returns this year, however, showed domestic index and semiconductor ETFs outperforming U.S. index products.

6. Trump Targets Korea Again Over Iran Operation, Hinting at Trade Retaliation: "We Will Make a Lot of Money"

- Key points: U.S. President Donald Trump hinted at trade retaliation while mentioning Korea in a Fox News interview released on the 30th. Trump said the United States spends billions of dollars for NATO and other countries without receiving help in return, citing Korea as an example, and said the country would be able to make a lot of money going forward. U.S. Treasury Secretary Scott Bessent, meanwhile, urged G20 member countries to review their trade terms with China. The yield on Japan's 10-year government bond rose to 2.950% in the Tokyo bond market on the 31st, the highest level in about 30 years, or since September 1996.