SK Hynix overcame sharp intraday volatility, falling more than 6% during the session before closing higher, drawing attention to whether the stock can extend its rebound on the market on the 26th. Analysts say the stock could seek an upward direction again, as its 40 trillion won share buyback program serves as a safety net for supply and demand, coupled with a rebound in U.S. semiconductor stocks.

■ Recovers 6% Intraday Plunge... Closes Up at 1,678,000 Won

On the 25th at the Korea Exchange, SK Hynix finished trading at 1,678,000 won, up 7,000 won (0.42%) from the previous session. The stock opened at 1,598,000 won and fell to as low as 1,557,000 won intraday, but quickly recovered its losses, rising to 1,687,000 won during the session before closing higher.

■ 40 Trillion Won Buyback Acts as Supply-Demand Safety Net

SK Hynix held a board meeting on the 19th and resolved to acquire a total of 40 trillion won worth of treasury stock and cancel all of it. Based on the closing price of 1,662,000 won per share the day before the board resolution, this amounts to about 24.07 million shares, or about 3.3% of total issued shares. The acquisition period runs for about three months starting August 20.

Indeed, on the 25th, SK Hynix submitted an application to purchase 650,000 shares of treasury stock. Since the 20th, the company has bought 650,000 shares per day for four consecutive trading days, and analysts say it is serving as a supply-demand safety net absorbing foreign selling pressure. The buyback is likely to play an important role again in the stock's movement on the 26th.

■ U.S. Semiconductor Rebound, AI Earnings as Sentiment Boosters

On the New York Stock Exchange, the Dow Jones Industrial Average, the S&P 500, and the Nasdaq all rose. In particular, the tech-heavy Nasdaq gained relatively strongly and some semiconductor stocks that had recently weakened rebounded, which could act as a factor improving investment sentiment for domestic semiconductor stocks.

SK Hynix continues to post earnings growth centered on the AI memory market. According to the company, its net cash stood at about 69 trillion won as of the end of the second quarter this year, a significant improvement in cash generation. The company plans to return more than 50% of cumulative free cash flow from 2025 to 2027 to shareholders, combining share buybacks and cancellations with cash dividends.

Brokerages also analyze that the large-scale buyback could have a positive impact not only on short-term supply and demand but also on medium- to long-term per-share value. Mirae Asset Securities projected that if the current shareholder return policy is maintained over the long term, the number of shares outstanding could shrink by about 28% by 2030 through buybacks and cancellations, with an accompanying effect of higher earnings per share.

■ Wild Card Is Foreign Selling... Today's Stock Barometer

However, it is difficult to say for certain that the stock will rise on the 26th. On the 25th, SK Hynix shares swung from 1,557,000 won to 1,687,000 won within a single day, showing a wide trading range. In particular, the fact that foreign investors net sold nearly 2 trillion won worth of shares remains a burden. While the buyback and purchases by institutions and retail investors are absorbing foreign selling, intraday volatility could widen if foreign selling intensifies again.

In the market on the 26th, one benchmark for judging the short-term trend will be whether the stock, starting from 1,678,000 won, can break above the previous day's intraday high in the 1,687,000 won range. Conversely, if selling pressure emerges again early in the session, another point to watch is how much of a floor the buyback can provide.

The recovery in semiconductor investment sentiment seen in the New York market the previous day, the 40 trillion won buyback, and earnings growth in the AI memory market are all favorable factors for SK Hynix on the 26th. On the other hand, the recent sharp expansion in volatility and large-scale foreign selling could be variables limiting the upside. Ultimately, SK Hynix's market performance on the 26th will likely be determined by which force proves stronger: the powerful supply-demand factor of the buyback or foreign selling pressure.

While the fact that the stock recouped its entire early-session plunge and closed higher on the 25th confirms short-term resilience, this should not be interpreted outright as a confirmed signal of further gains; foreign investor flows and the overall semiconductor sector trend should be examined together.

[Stock prices can fluctuate significantly depending on corporate earnings and business conditions, domestic and overseas market trends, foreign and institutional investor flows, and changes in exchange rates and interest rates. Share buybacks and cancellations can positively contribute to shareholder value, but they do not guarantee future stock price increases, and a single day's price movement cannot determine the direction of the next trading day. This article is a forward-looking piece based on publicly available information and market conditions, and is not intended to recommend buying or selling any specific stock or to guarantee investment returns. This article was written with AI assistance.]