Samsung Electronics, SK Hynix plunge as CPI and Middle East tensions hit Korea

  • Samsung Electronics and SK Hynix fell sharply in Nextrade premarket trading.
  • SK Hynix dropped 57,000 won, or 3.15%, to 1.755 million won.
  • Federal Reserve rate-hike odds reached approximately 87% for September, CME FedWatch indicated.

Samsung Electronics and SK Hynix fell sharply in South Korean premarket trading on September 14 as renewed U.S. rate-hike concerns and rising Middle East tensions pressured semiconductor stocks. Samsung traded at 254,000 won, down 2.12%, while SK Hynix dropped 3.15% to 1.755 million won by 8:15 a.m. The decline spread across most large-cap shares, although Doosan Enerbility, HD Hyundai Heavy Industries, KB Financial Group, Hanwha Aerospace, and Shinhan Financial Group gained. August U.S. CPI (Consumer Price Index, a measure of consumer inflation) rose 0.4% month-over-month and 3.4% year-over-year, while core CPI increased 0.3%, above the 0.2% consensus. CME FedWatch Tool data showed the implied probability of a 25-basis-point Federal Reserve rate increase in September rising from about 60% to approximately 87%. Investors also remained concerned about potential shipping and oil-market disruptions after Houthi activity near the Bab el-Mandeb Strait, the delayed Salalah meeting on safe shipping lanes, and the upcoming September FOMC (Federal Open Market Committee, the Fed's policy-setting body) meeting. Analysts said short-term volatility is likely to expand, while Han Ji-young of Kiwoom Securities advised investors to increase equity exposure rather than simply hold more cash.

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