CNBC host Jim Cramer expressed frustration over Micron Technology (MU) trading in tight tandem with South Korean memory producer SK Hynix, leaving the US chipmaker exposed to overnight price action in Seoul. Speaking on CNBC's Mad Money, Jim Cramer noted that he hopes the tight price linkage between the two semiconductor leaders ends soon.
Shared AI Demand and Competitive Pressures
The strong correlation between the two semiconductor giants was highlighted on Oct. 13, when SK Hynix closed 10.09% lower in Seoul trading, subsequently dragging Micron down by approximately 5% during US market hours. SK Hynix and Samsung Electronics together account for more than half of South Korea's equity market capitalization, giving price movements in Seoul significant weight over global technology sentiment.
Both companies share fundamental industry drivers, including strong demand for high-bandwidth memory (HBM) chips paired with AI hardware, as well as joint headwind risks. For instance, announcements from Chinese DRAM producer ChangXin Memory Technologies (CXMT) regarding denser memory-cell designs have impacted both stocks simultaneously.
Record Q3 Earnings Fail to Decouple Stock Trends
On Oct. 28, SK Hynix posted record third-quarter operating profits of 83.33 trillion won ($62.8 billion), marking a 632% increase year-over-year and surpassing consensus forecasts of 76.96 trillion won. Despite the record performance, SK Hynix shares fell nearly 8% in Seoul the day before the report, demonstrating the volatility surrounding South Korean technology trading ahead of earnings releases, much like recent swings across South Korean stock indices.
Key developments tracking the Micron and SK Hynix relationship include:
- Oct. 13 Sell-off: SK Hynix fell 10.09%, pushing Micron down ~5%.
- Record Financials: SK Hynix Q3 operating profit reached 83.33 trillion won ($62.8 billion) against a 76.96 trillion won consensus.
- Nasdaq ADR Listing: SK Hynix American Depositary Receipts debuted on Nasdaq in July, enabling direct US trading comparison alongside Micron.
- Broker Preference: F&C Equities favored Micron in July, citing Korean market risks and international tariff exposures.
Why It Matters
The tight price correlation between Micron and SK Hynix demonstrates how deeply global semiconductor supply chains are entangled around artificial intelligence hardware demand. While Micron offers investors US corporate governance and domestic manufacturing exposure, its equity performance remains anchored to East Asian market hours and regional competitive threats like CXMT. As SK Hynix ADRs increase liquidity on Nasdaq, investors should expect overnight Seoul market movements to remain a primary leading indicator for Micron share price direction.
