SK Hynix's shares rose over 12% following the company's decision to accelerate its stock buyback program to 40 trillion won ($28.7 billion) and to increase shareholder returns to over 50% of cumulative free cash flow from 2025 to 2027.
Peter Lee, an analyst at Citi, noted that this initiative is likely to provide a solid support level for the share price in the near term, indicating the company's confidence in its long-term growth despite challenges in the memory sector.
This announcement comes alongside SK Hynix's plans to invest 54 trillion won in new memory chip manufacturing plants, driven by rising demand for components essential for artificial intelligence.
The positive sentiment around SK Hynix also contributed to a broader recovery in Asian tech stocks, with notable gains in Samsung Electronics and Kakao in South Korea, as well as SoftBank Group and Nintendo in Japan. The overall market sentiment was bolstered by a rebound in U.S. stocks, which had previously experienced a three-day decline due to high Treasury yields.
The volatility in tech stocks, particularly in South Korea's semiconductor market, highlights the ongoing fluctuations in investor sentiment