[Good Morning Market] "Nvidia's Strong Earnings... Major Korean Semiconductor Stocks Expected to Open Higher"

by Kim Daehyun

Published 29 May.2025 08:21(KST)

Nvidia, the leading artificial intelligence (AI) stock, achieved solid results in the first quarter of this year despite export restrictions to China. As a result, major semiconductor stocks in the Korean stock market are expected to open higher on May 29.

On the 28th (local time), all three major U.S. stock indexes closed lower after rebounding the previous day. On the New York Stock Exchange, the blue-chip Dow Jones Industrial Average (Dow Jones Index) fell by 244.95 points (0.58%) to close at 42,098.7. The large-cap S&P 500 Index dropped 32.99 points (0.56%) to 5,888.55, while the tech-heavy Nasdaq Index slipped 98.23 points (0.51%) to finish at 19,100.94.

On the 28th (local time), a trader is working at the New York Stock Exchange in the United States. Photo by UPI

By stock, Cadence Design Systems, a U.S. semiconductor design software company, plunged 10.67%. Reports that the Trump administration is considering restricting the export of semiconductor design software to China fueled selling pressure. Synopsys, another semiconductor design company, fell 9.64%.

Nvidia declined by 0.51% during regular trading, but after announcing first-quarter results that exceeded market expectations, the stock rebounded by more than 5% in after-hours trading. Nvidia reported that revenue for the first quarter of fiscal year 2026 (February to April 2025) was $44.06 billion and net income was $18.8 billion, up 69% and 26%, respectively, compared to the same period last year. Specifically, revenue from its main data center segment, which includes AI chips and related components, grew 73% year-on-year to $39.1 billion, driving overall revenue growth. The continued expansion of demand for AI semiconductors appears to be due to the spread of generative AI such as ChatGPT.

Regarding the Korean stock market, Lee Sunghoon, a researcher at Kiwoom Securities, said, "Investor sentiment for AI is improving thanks to Nvidia's strong results. Major semiconductor stocks, including those related to high-bandwidth memory (HBM), are expected to start higher." He added, "In the previous session, funds rotated from previously leading sectors to previously neglected stocks such as semiconductors and secondary batteries. It is worth watching whether this trend will continue today." He also noted, "Given that there has recently been excessive concentration of funds in certain sectors, there is a possibility that, in the short term, profit-taking in leading stocks will be followed by continued fund rotation into neglected stocks."

Kim Ji-won, a researcher at KB Securities, said, "Yesterday, the KOSPI broke through the 2,690 level during the session, marking the highest point since September last year. After three consecutive days of gains, some fatigue is expected to be reflected in the KOSPI." Kim also noted, "At today's Bank of Korea Monetary Policy Committee meeting, expectations for a rate cut are dominant. The growth outlook for this year will also be in focus. While a downward revision is inevitable, there is even talk that the figure could fall below 1%."