Quick Read
SK Hynix surged 8% to $164 from a 52-week low of $146 after HSBC reaffirmed SKHY as its top chip sector pick.
SKHY’s jump was purely stock-specific, with the SOXX semiconductor ETF barely moving, and it was amplified by short-covering and gamma buying during the first U.S. options expiration.
South Korea’s surprise rate hike and a leveraged-ETF approval suspension stripped away speculative demand that had inflated SK Hynix’s ADR premium all week.
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Shares of SK Hynix (NASDAQ:SKHY) are up 8% to $164 in Friday’s midday session. The rebound follows a brutal two-day rout that sent the Korean memory giant’s newly listed American depositary receipts (ADR) to a fresh low.
SK Hynix stock touched a 52-week low of $145.57 earlier in the week before buyers stepped in. The bounce follows a sharp two-day slide, one of the ugliest stretches since the company’s blockbuster Nasdaq exchange debut.
The move stands out on its own merits. Peer semiconductor stocks are hovering near unchanged, leaving SK Hynix stock as the standout mover on an otherwise quiet session.
The Rout That Set Up the Bounce
The selloff earlier this week traced to the Bank of Korea’s surprise 25-basis-point interest rate hike on Thursday, its first in about three and a half years. The move sparked a broad Korean equity selloff that tripped a circuit breaker on the KOSPI, with SK Hynix’s Seoul-listed shares plunging more than 7%.
Sentiment took another hit when South Korean regulators temporarily suspended approvals for new single-stock leveraged ETFs tied to the chipmaker. That decision removed a key source of speculative demand that had helped inflate SK Hynix stock’s ADR premium since the U.S. listing, according to reporting from Investing.com and Barron’s.
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HSBC’s Top-Pick Call and Options Expiry Fuel the Rebound
Friday’s rebound has multiple hands on the wheel. HSBC reaffirmed SK Hynix as its top sector pick on Thursday, arguing that fears the memory-chip cycle is nearing its peak are overstated, an endorsement that landed just as SK Hynix stock was scraping session lows.
The first monthly options contracts on SK Hynix’s U.S.-listed shares expired today, and traders cite short-covering and gamma-related buying accelerating the move off the lows. SK Hynix’s options chain shows put open interest of 93,823 contracts against call open interest of 36,876 on today’s expiration, a heavy short-hedged setup that can amplify upside squeezes once dealers rebalance.
