SK Hynix Tumbles 7.74% as Democrats' Congress Win Spooks Chip Stocks

SK Hynix took a 7.74% beating Thursday, landing at 1.288 million won. Samsung Electronics wasn't spared either, sliding 5.50% to 206,000 won by 10:01 a.m., according to TradingView data. The Korea Composite Stock Price Index dropped 1.98% to 5,570.99 by 9:15 a.m.

The trigger: US Democrats won control of Congress, and traders immediately started worrying about stricter rules on AI data centers. Those facilities are the demand engine behind high-bandwidth memory chips — the HBM that SK Hynix and Samsung supply. The read in Seoul is that a slower data center buildout is now on the table.

The split-screen is stark. The Dow jumped 3% Wednesday, a roughly 1,500-point rally, while the Philadelphia Semiconductor Index fell 3.1% to a six-month low. Barclays said the election result likely delivers legislative gridlock, per LBC. Democrats take control when lawmakers are sworn in on Jan. 3, WBUR reported — and Yonhap noted there's no specific bill behind the chip selloff.

Public opinion may be working against the chip trade's hopes. A USC Annenberg survey of 2,980 adults found 78% believe government does too little on data centers, including 69% of Republicans.

The damage over a longer window is brutal: SK Hynix is down 29.86% over one month and Samsung down 26.39%, per TradingView. SK Hynix closed at 1.487 million won on Oct. 28 after posting record quarterly sales of 104.6 trillion won, and now sits about 13% below that mark. Even so, it's still up 97.70% year to date.

Goldman Sachs cut its KOSPI target on Oct. 25, taking it down from 12,000 to 9,000. The bank estimated chip valuations were implying a 65% drop in 2027 sector earnings and called that excessively pessimistic. If Congress passes nothing after Jan. 3, this selloff will look overdone.