Global rate fears weigh on Korean stocks as CXMT advances HBM3E production

  • Foreign investors sold Korean shares as rate-sensitive biotechnology and brokerage stocks declined.
  • The September rate-hike probability rose to 59.7% after Kevin Warsh’s Jackson Hole remarks.
  • CXMT began small-scale HBM3E production while Samsung, SK hynix and Micron supplied HBM4E samples.

Korean equities are facing weaker market breadth as hawkish remarks by Federal Reserve Chair Kevin Warsh lifted the probability of a September rate hike to 59.7% from about 35% previously. Rate-sensitive biotechnology and brokerage shares fell, while August average daily KOSPI trading value dropped to 25.75 trillion won from 50.35 trillion won in June. Foreign investors sold 10.17 trillion won of Korean shares in August, extending their selling streak to four months, and institutions sold 5.07 trillion won. U.S. long-term Treasury yields also remained elevated, with the 30-year yield at 5.275% and above 5% for 55 sessions, while the 10-year yield reached 4.780%. China’s Changxin Memory Technologies has begun small-scale production of HBM3E (fifth-generation high-bandwidth memory), with Alibaba-affiliated chip designers testing the product, although Samsung Electronics, SK hynix and Micron have already supplied HBM4E samples and retain a reported three- to five-year technology lead. Other market developments included corporate share buybacks supporting the KOSPI, rapid growth in bond-mixed ETFs (exchange-traded funds) used by pension investors, and concerns over DB HiTek’s hesitation to expand power semiconductor capacity despite strong first-half results.

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