Shares of SK Hynix Inc. (NASDAQ: SKHY) fell more than 11% in Seoul on Thursday, contributing to a broader decline in the global semiconductor sector. The drop comes as investors react to hotter-than-expected U.S. inflation data, renewed bets on Federal Reserve interest rate hikes, and concerns regarding the financing of artificial intelligence infrastructure projects.
At the time of writing, SK Hynix stock was trading at KRW 1,257,000, which translates to approximately $929.92. This decline mirrors the performance of other major chipmakers in the region, with Samsung Electronics falling 8.84% to KRW 211,500 ($156.47). The South Korean KOSPI index also dropped significantly, falling 7.81% to 5,539.34.
The selloff extended from Asia to Wall Street, where the Nasdaq Composite fell 1.88% to 26,692.87 and the S&P 500 slid 1.11% to 7,718.94. The iShares Semiconductor ETF (NASDAQ: SOXX), which had gained over 70% this year, has now lost money in seven consecutive sessions.
Market participants are citing several specific factors driving the volatility. U.S. consumer prices rose 3.7% year over year in September, up from 3.4% in August, according to the Bureau of Labor Statistics. This data has revived fears that the Federal Reserve may need to raise rates further. Additionally, executives from major technology companies have warned that access to capital could become a bottleneck for AI buildouts. Broadcom Inc. CEO Hock Tan stated that capital access could become a bigger obstacle than chip or power shortages, while Intel Corp. CEO Lip-Bu Tan flagged rising financing costs and uncertainty over investment returns. Goldman Sachs Group CEO David Solomon noted that the 10-year Treasury yield has risen about 75 basis points since early July, warning that not every data center project will secure favorable financing.
On the Nasdaq, SK Hynix’s American Depositary Receipts (ADRs) closed 6.06% lower on Wednesday at $147.55. In extended trading, the ADRs fell an additional 3.96% to $141.71.
