Chip Stocks and the AI Trade: Nvidia to SK hynix — 2026-09-12
Chip stocks faced renewed volatility this week as DeepSeek’s latest AI model raised doubts about memory demand, causing shares of SK hynix and Samsung Electronics to dip. Meanwhile, TSMC continued to attract significant foreign investment in Taiwan, with analysts noting that CoWoS capacity remains fully booked through 2026, driving order spillover to alternative packaging providers.
Chip Stocks and the AI Trade: Nvidia to SK hynix — 2026-09-12
Top developments
DeepSeek Model Sparks Sell-off in Memory Giants
On September 11, 2026, SK hynix and Samsung Electronics shares dipped 2.2% and 3.5% respectively, following the release of DeepSeek’s latest AI model which raised concerns among fund managers regarding the strength of future demand for high-bandwidth memory (HBM). This pullback serves as a gut check for investors who had recently re-entered South Korean memory stocks, highlighting the sensitivity of the sector to shifts in AI model efficiency and demand forecasts.
TSMC’s CoWoS Bottleneck Drives Order Spillover
TSMC’s advanced packaging capacity (CoWoS) remains fully booked through 2026, with expansion efforts struggling to keep pace with AI demand. This constraint has led to order spillover to non-TSMC players, boosting demand for Intel, ASE Technology, Amkor, and silicon interposer suppliers like UMC and World Advanced Semiconductor, as reported by local media on September 11.
Foreign Investors Pour Record Capital into Taiwan Chip Stocks
Foreign net buyers accumulated NT$88.3 billion worth of stocks on September 7, marking the fourth-largest single-day inflow in history. Approximately NT$40 billion was specifically directed toward TSMC, pushing the weighted index to a second-highest closing record of 47,326 points. This surge was supported by strong performance from TSMC and AI-related stocks like Xilinx (5274).
Tokyo Electron Announces Stock Split
Tokyo Electron announced it will execute a 1-for-5 stock split effective October 1, 2026, with the base date set for September 30. This move is expected to enhance liquidity for the semiconductor equipment maker, which benefits directly from AI-driven capital expenditures by major chipmakers.
Local view
Taiwan: Local media outlets like UDN and Newtalk highlighted the historic foreign inflows into TSMC, noting that despite the massive buying, the market saw a reversal on September 10 with institutional selling of NT$50.3 billion, indicating volatility as investors digest valuation levels.
Japan: Zaikei Shimbun reported that Advantest shares initially rose but then fell, reflecting mixed sentiment around NVIDIA's recent performance and broader semiconductor equipment valuations. The Nikkei average saw significant swings, with Advantest alone dragging the index down by approximately 617 yen on September 11.
Context & numbers
- HBM Market Share: In Q2 2026, SK hynix held 50% of the HBM market, while Samsung Electronics increased its share to 33%, narrowing the gap between the two Korean giants.
- Analyst Targets: LS Securities recently cut its target price for SK hynix by 27% to 2.4 million won while raising its target for Samsung Electronics to 450,000 won, citing Samsung's HBM4 gains.
- CoWoS Capacity: TSMC’s CoWoS-L advanced-packaging capacity is estimated at ~130,000 wafers per month by the end of 2026, up from ~75,000 in 2025, yet demand continues to exceed supply.
- NVIDIA Ownership: As of late August 2026, 82% of US active fund managers held NVIDIA in their portfolios, making it one of the most crowded trades in the market.
On the radar
- Tokyo Electron Split: Watch for increased trading volume and retail interest in Tokyo Electron (8035) leading up to the October 1 split effective date.
- HBM4 Competition: Analysts are closely monitoring yield rates and supply agreements for HBM4, as Samsung’s rising market share puts pressure on SK hynix’s pricing power.
- Export Control Reviews: The BIS case-by-case review policy for chips like the Nvidia H200 remains in effect; any new license approvals or denials could impact short-term sentiment for US chipmakers selling to China.
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