SK Hynix shares retreat after Nasdaq debut as investors take profits

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SK Hynix shares fell sharply on Monday, giving back gains made after the company's strong Nasdaq debut, as investors locked in profits and reassessed valuations following the memory chip maker's recent rally. The South Korean chipmaker's shares closed down 15.4% in Seoul, marking their largest single-day decline on record, while its Nasdaq-listed shares were down about 6% after climbing 12.8% in their Wall Street debut on Friday. Nigel Green, chief executive of financial advisory firm deVere Group, said the sharp reversal highlights the difference between enthusiasm surrounding high-profile listings and longer-term business performance, noting that a debut-day pop tells little about a company's earnings power. The broader semiconductor sector also traded lower, with Micron and Sandisk each losing about 4%, Seagate dropping 3%, and AMD and Intel falling around 2%, while Taiwan Semiconductor Manufacturing Co. shares rose about 1% after reporting a 67.9% year-over-year increase in June revenue. Green contrasted the declines with TSMC's performance, stating that fundamentals held up while hype didn't, and added that the SK Hynix pullback could serve as a reminder for investors to distinguish between companies supported by operating performance and those benefiting primarily from market momentum.

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Shares fell sharply as investors took profits and reassessed valuations after the Nasdaq debut rally, with analyst commentary questioning earnings power.