Asian stocks rally as SK hynix breathes life back into AI trade

South Korea's Kospi led gains across most Asian markets Friday as a record-breaking US share sale by chip titan SK hynix breathed fresh life into the tech sector after weeks of selling.

The breathtaking $26.5 billion listing by SK provided some much-needed affirmation to investors that the AI boom remains on course, despite lingering worries about extended valuations and eye-watering capital spending.

The news came as attention turns to the upcoming earnings season, with traders looking to companies' outlook for the industry and investment plans amid expectations that interest rates will be kept elevated for the time being.

SK hynix set a price of $149 for each American depositary share (ADS) -- slightly more than its Seoul closing price Thursday -- ahead of its debut on the Nasdaq on Friday.

That meant it had raised $26.5 billion, the most for a US listing by a foreign firm.

The company, a supplier of advanced memory chips to industry behemoth Nvidia, has seen profits skyrocket thanks to the global race to build artificial intelligence data centres.

Its Seoul-listed shares had ballooned almost 700 percent in the 12 months to its peak on June 23, before it got caught up in a global tech rout fuelled by fears of overheated valuations and questions about when huge investments will reap returns.

SK hynix along with Samsung and Micron are heavyweights in the global market for the advanced components known as high-bandwidth memory (HBM), used in AI servers alongside other data-crunching semiconductors.

Stephen Innes at SPI Asset Management said the fact the share sale was more than seven times oversubscribed "tells you all you need to know about the current temperature of the market". 

"Investors are still desperate for anything bolted to AI infrastructure, especially if it sits close to the high-bandwidth memory bottleneck."

Seoul's Kospi jumped more than four percent at one point Friday though SK hynix was up just one percent, having added around five percent Thursday. Samsung was four percent higher.

Tokyo also saw strong gains, with tech investment giant SoftBank piling on more than 10 percent while Tokyo Electron and Advantest were four percent up.

Hong Kong, Shanghai, Singapore, Sydney and Jakarta joined the advances in early trade.

The mood on oil trading floors was also a little less tense than earlier in the week as investors become less concerned that the recent US-Iran flare-up over the Strait of Hormuz would reignite their war.

Both main crude contracts edged up slightly Friday, having dropped around two percent the day before, with analysts pointing out that more oil is produced outside the Gulf region, tempering the impact of disruptions.

The fall in prices Thursday "suggests investors continue to view the latest escalation as a temporary setback rather than the start of a prolonged conflict", said City Index's Fiona Cincotta.

"Oil prices are pulling back after Wednesday's sharp rally, indicating that markets still expect diplomacy to ultimately prevail and that any disruption to global energy supplies is likely to be limited."

- Key figures around 0230 GMT -

Seoul - Kospi: UP 3.4 percent at 7,539.56

Tokyo - Nikkei 225: UP 1.8 percent at 68,943.76 (break)

Hong Kong - Hang Seng Index: UP 1.5 percent at 24,386.91

Shanghai - Composite: UP 0.5 percent at 4,055.00

Dollar/yen: DOWN at 161.43 yen from 162.38 yen on Thursday

Euro/dollar: UP at $1.1458 from $1.1430

Pound/dollar: UP at $1.3449 from $1.3410

Euro/pound: DOWN at 85.19 pence from 85.23 pence

West Texas Intermediate: UP 0.1 percent at $72.16 a barrel

Brent North Sea Crude: UP 0.1 percent at $76.35 a barrel

New York - Dow: UP 0.3 percent at 52,487.41 (close)

London - FTSE 100: DOWN 0.2 percent at 10,472.45 (close) 

dan/tc

© Agence France-Presse