Samsung Electronics, SK Hynix Drop 7%-8% as Surge in Long-Term Yields Sours Sentiment

Samsung Electronics Co. and SK Hynix Inc., South Korea's two biggest chipmakers, tumbled in early trading on Aug. 19 as a sharp rise in long-term government bond yields in the U.S. and Japan unnerved investors.

As of 9:12 a.m., Samsung Electronics was trading at 249,250 won, down 7.17% from the previous session. SK Hynix had fallen 8.42% to 1.522 million won. Samsung Electronics preferred shares were down 6.64%, while SK Square slid 11.28% and Samsung Life Insurance fell 9.18%.

The selloff came after Wall Street extended losses overnight as rising long-term bond yields weighed on sentiment.

The yield on the 30-year U.S. Treasury climbed above 5.33% during trading on Aug. 18, reaching its highest level since 2007. The move came as rising bond yields in major markets including Europe and Japan spilled over globally. It also reflected a supply-demand imbalance driven by heavier government borrowing to cover fiscal deficits and a surge in corporate bond issuance demand from Big Tech companies funding artificial intelligence investments.

The fallout also hit U.S. stocks, with profit-taking intensifying in semiconductor names such as Micron and SanDisk. The Philadelphia Semiconductor Index sank nearly 5%.

Noh Jung-dong, Hankyung.com reporter, dong2@hankyung.com