(Yonhap)
The stocks of South Korean chipmakers Samsung Electronics Co. and SK hynix Inc. traded lower on Friday morning after sharp gains on Thursday.
Samsung Electronics shares were trading at 295,500 won ($195.95) as of 9:14 a.m., down 1.34 percent from the previous session. SK hynix shares were trading 0.26 percent lower at 1.935 million won.
The declines were interpreted as a pause following the previous day’s sharp gains of 8.51 percent and 11.17 percent, respectively, driven by expectations for the end of the Iran war, a rebound in global semiconductor stocks, and the tentative wage agreement between Samsung Electronics management and labor.
Overnight, all three major indexes on Wall Street closed higher.
The Dow Jones Industrial Average rose 0.55 percent, while the S&P 500 and the Nasdaq Composite gained 0.17 percent and 0.09 percent, respectively.
The Philadelphia Semiconductor Index climbed 1.28 percent.
Foreign investors were net sellers of 1.2 trillion won worth of Kospi stocks, while retail and institutional investors were net buyers of 1.09 trillion won and 171.1 billion won, respectively.
In the electric and electronics sector, foreign investors were net sellers of 1 trillion won, while retail and institutional investors were net buyers of 932.1 billion won and 90.8 billion won, respectively.
(Yonhap)
Meanwhile, aluminum-related stocks rose sharply in early trading Friday.
Shares of Sama Aluminium Co. were trading at 88,400 won as of 9:24 a.m., up 6.38 percent from the previous day.
The stock opened 3.37 percent higher and at one point surged 10.71 percent to 92,000 won.
Other aluminum-related stocks also rose, including SM Namsun Aluminum Co. up 3.19 percent, and Choil Aluminum Co up 1.91 percent.
The buying momentum appears to have been fueled by expectations that soaring aluminum prices amid the war between the United States and Iran would benefit related companies.
In particular, even as discussions about negotiations between the two countries emerged, investor sentiment strengthened further on analyses that Iran’s attacks would restrict Middle Eastern aluminum production for an extended period.
“Even though the potential reopening of the Strait of Hormuz is being discussed again, disruptions to aluminum exports are unlikely to ease anytime soon,” said Choi Jin-young, an analyst at Daishin Securities Co.
“The Middle East accounts for 9.2 percent of global aluminum supply capacity, and export disruptions caused by this war amount to 2.9 percent, or 2.25 million tons.”
In particular, Choi said that some facilities owned by Emirates Global Aluminium (EGA) in the United Arab Emirates and Alba in Bahrain have lost production capabilities due to Iranian military attacks.
“The fact that authorities stated that full normalization will take more than 12 months provides a solid basis for predicting that supply will remain tight until the first half of next year,“ he added.
Choi also said China, the world’s largest aluminum producer, would find it difficult to offset the supply disruptions due to recent Chinese government restrictions on the mining and exports of strategic minerals.
“We maintain our ‘overweight’ view on aluminum through the first half of next year,” he said.
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