The "Astra effect" is spreading from South Korea's large-cap chipmakers to semiconductor materials, components and equipment stocks, as Samsung Electronics and SK hynix lead a broad rally. Shares tied to back-end processing and packaging have posted the strongest gains, driven by expectations that artificial intelligence demand will lift the memory chip market.
As of 10:22 a.m. on the 7th, Samsung Electronics (005930.KS) traded at 265,000 won, up 3.82% from the previous session. SK hynix (000660.KS) rose 5.89% to 1.745 million won.
The strength in large caps has extended to back-end processing, packaging and other suppliers. Doosan Tesna jumped as much as 12.25% during the session to 83,500 won. Psk Holdings gained more than 8%, while equipment and back-end names including DB HiTek (000990.KS), up 12.46%, Tes, up 4.97%, and EO Technics, up 64.85%, also advanced. Eugene Technology (084370.KS), Soulbrain (357780.KS) and Wonik IPS (240810.KS) were also stronger in early trading.
The rally follows OpenAI's release last week of a new AI model called Astra, which the company said marked the arrival of the era of artificial general intelligence. Expectations that the spread of high-performance AI models will boost demand for high-capacity memory and keep memory prices rising have lifted sentiment across chip stocks.
The three main U.S. stock indexes fell in New York on the 4th, but the Philadelphia Semiconductor Index rose 3.38%. Major chip stocks including SK hynix's American depositary receipts, Micron Technology and SanDisk also gained. The renewed appetite for AI chip demand in U.S. markets carried over to Seoul.
With foreign and institutional investors both net buyers, Samsung Electronics and SK hynix drove the benchmark KOSPI up more than 3% in early trading, returning the index above the 6,900 level.
Brokerages are also growing more optimistic about a memory supply shortage and higher prices. KB Securities said memory inventories at Samsung Electronics and SK hynix fell below 10 days in the third quarter, and that because HBM4 high-bandwidth memory consumes roughly three times the wafer capacity of commodity DRAM, DRAM and NAND demand next year could exceed supply by more than 10 percentage points.
Target prices for the large-cap chipmakers are being raised on expectations of an improving memory market. Mirae Asset Securities (006800.KS) lifted its target price for Samsung Electronics to 400,000 won from 370,000 won, and for SK hynix to 3.1 million won from 2.8 million won. DB Securities (016610.KS) also raised its SK hynix target to 2.3 million won from 2 million won, citing earnings gains from higher HBM prices.
Shinhan Securities' research division said in a recent report, "Let's look for a rebound in materials and equipment," maintaining an overweight rating on the IT materials, components and equipment sector. It said substrate makers stand out in terms of growth, while front-end and back-end component suppliers are the most attractive on valuation.
