[Featured Stocks] Samsung Electronics and SK Hynix weaken... Tensions between the US and Iran escalate again, semiconductor stocks enter correction

Samsung Electronics and SK Hynix both declined in pre-market trading. Due to the retreat in expectations of a US-Iran ceasefire and the overnight Philadelphia Semiconductor Index dropping over 2%, large semiconductor stocks are facing increased profit-taking pressure.

According to Nextrade data, in pre-market trading, Samsung Electronics fell 6,500 won (2.39%) from the previous trading day, to 265,000 won. The current market price for Samsung Electronics stock is also 265,000 won, consistent with the stock mentioned in the article. SK Hynix dropped 40,100 won (2.48%), to 1,613,000 won.

Additionally, SK Square declined 38,000 won (3.46%), to 1,061,000 won; LG Energy Solution fell 9,000 won (1.86%), to 474,000 won; Hyundai Motor decreased 5,000 won (0.87%), to 567,000 won. Doosan Energy dropped 3,000 won (2.20%), to 133,400 won; HD Hyundai Heavy Industries declined 23,000 won (3.32%), to 670k won; Samsung Electro-Mechanics fell 25,000 won (2.73%), to 892,000 won. On the other hand, Samsung Biologics rose 7,000 won (0.48%), to 1,475,000 won; Hanwha Aerospace increased 33,000 won (2.51%), to 1.35M won, showing strong performance.

Overnight, the New York stock markets collectively declined due to renewed uncertainties related to the US-Iran situation. The Dow Jones Industrial Average fell 0.63%, the S&P 500 declined 0.38%, and the Nasdaq dropped 0.13%. Especially, the Philadelphia Semiconductor Index fell 2.72%.

The direct pressure comes from weak performance guidance from ARM. ARM plummeted 10.1%, Micron dropped 2.99%, SanDisk fell 5.0%, and AMD declined 3.07%. Analysts believe that, following a day of significant gains in semiconductor stocks driven by expectations of a US-Iran ceasefire, profit-taking selling emerged just a day later.

The previous day, influenced by the heightened ceasefire expectations, Samsung Electronics rose 6.58%, SK Hynix increased 5.56%, and the Philadelphia Semiconductor Index also rose 4.48%. However, as the US-Iran memorandum of understanding negotiations lost momentum and reports from The Wall Street Journal (WSJ) indicated that the US might restart the Hormuz Strait blockade “Freedom Plan,” investor sentiment quickly cooled.

Furthermore, CIA analysts believe Iran can withstand the impact of a maritime blockade for months, increasing uncertainty around Middle East tensions once again. The day before, even though US semiconductor stocks performed strongly, the KOSPI experienced initial volatility due to foreign investors selling off for a profit of 7.1 trillion won, which is also seen as a pressure factor for the day.

Kiwoom Securities analyst Han Ji-young stated, “Factors such as noise from US-Iran ceasefire negotiations and the weakness of the Philadelphia Semiconductor Index will stimulate profit-taking pressure mainly on domestic AI industry chain stocks, possibly leading to sideways consolidation,” “During this process, funds may rotate into neglected sectors, including the military industry.”