Hong Kong chip stocks surge as US semiconductor index jumps 8%

The Hang Seng Index opened at 25,837, down 21 points, as chip stocks surged after the PHLX Semiconductor Index jumped 8% overnight.

"Memory chips will continue to be needed, so the stock price will rise over time. Rather than buying and selling repeatedly, it is better to hold on to the shares," Chey Tae-won, chairman of SK Group, said at the Korea Chamber of Commerce and Industry's Jeju Summer Forum earlier this month.

The Hang Seng Tech Index opened at 4,818, up 14 points or 0.3%, while the Hang Seng China Enterprises Index opened at 8,623, down 21 points or 0.24%. SMIC (00981.HK) surged 8.06%, while Hua Hong Grace (01347.HK), Iluvatar Corex (09903.HK) and Montage Tech (06809.HK) each opened more than 14% higher. The moves tracked the PHLX Semiconductor Sector Index, which leapt more than 8% overnight as the Nasdaq gained 2.8% and the S&P 500 rose nearly 1.7%.

The divergence within Hong Kong tech was notable: XIAOMI-W (01810.HK) opened 5.61% lower, MEITUAN-W (03690.HK) fell 2.86% and JD-SW (09618.HK) dropped 3.19%, while BABA-W (09988.HK) opened 2.1% higher. The selective rotation suggests investors are favoring semiconductor and hard tech names over consumer internet platforms as the AI-driven chip cycle accelerates.

In South Korea, SK Hynix shares climbed nearly 30% after SK Group Chairman Chey Tae-won made his first-ever personal purchase of the chipmaker's stock. According to a regulatory filing cited by The Korea Herald, Chey bought 3,620 SK Hynix shares from the open market, valued at about 4.79 billion won ($3.34 million). The transaction falls just below South Korea's five billion won threshold that would have required a 30-day advance disclosure. Chey had maintained indirect control of SK Hynix through SK Square, the chipmaker's largest shareholder with about 20% ownership.

The chairman's purchase reflects confidence in memory chip fundamentals at a time when SK Hynix's U.S.-listed ADRs had fallen about 35% from their July 14 peak and were trading 15% below their $149 offering price. UBS initiated coverage of the ADRs with a Buy rating and a $204 price target, arguing the current valuation does not fully reflect the company's structurally higher memory profitability, stronger free cash flow generation and improving shareholder returns.

The Hong Kong-listed leveraged products tracking SK Hynix also surged, with XL2CSOPSMSN (07747.HK) opening 14.99% higher and XL2CSOPHYNIX (07709.HK) spiking 14.98% at open.

The overnight US semiconductor rally, driven by the PHLX Semiconductor Sector Index's 8% jump, provided the backdrop for the Hong Kong hard tech surge. The Dow Jones Industrial Average rose 1.2% and the S&P 500 gained nearly 1.7%, with technology leading the advance. The strength in US chip names has been a persistent theme this year as AI infrastructure spending continues to drive demand for advanced semiconductors and memory products.

For investors, the key question is whether the semiconductor strength can sustain. Chey's personal investment in SK Hynix — his first direct stake in the company — adds weight to the memory chip thesis. The AI-driven demand for memory chips continues to be the primary driver of semiconductor valuations across the region, and the chairman's conviction in the sector's long-term trajectory could support further upside in both Korean and Hong Kong-listed chip names.

This article is for informational purposes only and does not constitute investment advice.