SK Hynix shares rose more than 2% in early trade on Monday, 9 November, as South Korea's stock market steadied after one of its worst two-day falls in years. The chipmaker climbed 2.74% to 1.312 million won by 9:09 a.m. local time, moving back above the 1.3 million won level.

The rebound followed the company's decision on Friday to halt consideration of a Nasdaq listing for Solidigm, its US-based subsidiary. The listing plan had been weighing on the shares, and the stock had already risen more than 4% at Friday's close in Seoul, with its American depositary receipts also gaining more than 4% in New York.

Samsung Electronics, the market's other heavyweight, edged up 0.23% to 216,000 won after fluctuating early in the session, while SK Square, which holds a stake in SK Hynix, gained 1.29% to 785,000 won. The Kospi's three largest companies by market capitalisation were all trading higher as the benchmark index repeatedly attempted to rebound.

Breathing room after an 11% plunge

The steadier tone came after the Kospi plunged 11% across Thursday and Friday, at one point breaking below the 5,000 mark, in the aftermath of the US midterm elections. Investors feared that a Democratic sweep in Congress could bring tighter regulation of artificial intelligence data centres, delaying orders for servers and semiconductors.

Over the same two sessions, the Nasdaq fell more than 5% and the Philadelphia Semiconductor Index dropped about 12%, while a circuit breaker was triggered early in the 6 November session in Seoul as selling intensified. Foreign investors recorded more than 10 trillion won, about $7.3 billion, in net selling last week.

The weekend session in New York offered the first relief. The Philadelphia Semiconductor Index rose more than 4%, and analysts said the move had at least put out the immediate fire in Seoul. "For the things that have fallen too far, we need to leave open the possibility of some recovery next week," Song Jae-kyung, head of the investment division at Dimension Investment Advisory, said.

Caution remains before Tuesday's CPI

Whether the rebound lasts is far from settled. The biggest test this week is the US October Consumer Price Index, due at 8:30 a.m. Eastern Time on Tuesday, 10 November. A softer-than-expected reading could support growth stocks by easing rate pressure, while a strong one could add to concerns about slowing AI investment.

Investors are also watching how data centre regulation takes shape in practice. It is not yet settled whether proposed rules would apply only to new projects or also cover already-permitted developments, and uncertainty over power procurement and start-up schedules could push server and semiconductor orders back, affecting shipment schedules for high-bandwidth memory and server memory at Samsung and SK Hynix.

Closer to home, SK Hynix is scheduled to report third-quarter earnings on Wednesday, with investors focused on the possibility of additional shareholder returns, while Samsung Electronics is due to release its finalised earnings results on Thursday.

Not every Seoul stock shared in the recovery. Shares of LIG Defense and Aerospace fell 6.62% to 444,000 won by 9:14 a.m., its fifth consecutive session of declines, after South Korea's Defense Acquisition Program Administration said on Sunday it had asked the trade ministry to consider revoking the company's designation as a defence contractor.