"It Has Surpassed Even the Dot-com Bubble"... Samsung Electronics and SK hynix Soar 798%, and the Rally May Not Be Over

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[The Financial News] The rally in artificial intelligence (AI) semiconductors led by Samsung Electronics and SK hynix has outpaced the gains seen during the dot-com bubble. Analysts say there is still room for further upside, supported by earnings and market demand.
According to KB Securities on the 3rd, the combined share price of Samsung Electronics and SK hynix had risen 798% as of the 1st from its lowest point over the past 500 trading days, surpassing the 717% gain recorded during the dot-com bubble.
Min Kyu Kim, a researcher at KB Securities, said, "The current strength of the South Korean semiconductor sector has entered a level never before experienced in history."
Investor attention on the semiconductor sector remains intense. Earnings forecasts for Samsung Electronics and SK hynix have been repeatedly raised, driven by expanding investment in Artificial Intelligence Servers and surging demand for High Bandwidth Memory (HBM).
Past market episodes suggest that bubbles often extend the life of leading stocks and create historic periods of excess returns. With solid earnings and continued buying from retail investors, the uptrend may continue for some time.
Still, some warned that the market has entered a phase that investors should approach with caution.
Kim said, "In a bubble phase, leading stocks often post historic excess returns," but added that "the market will not easily allow additional gains."
According to the report, the early stage of a bull market tends to bring smooth and rapid gains, but volatility usually expands as the market moves into the middle and later stages. During the dot-com bubble, volatility also widened sharply as stock prices rose, and a similar pattern is being observed now.
KB Securities noted that frequent trading in such an environment could actually hurt returns. When volatility rises, a single day’s trading decision can determine performance over weeks or even months.
Kim said, "What investors should focus on are the warning signs of a bubble burst, such as an economic slowdown, an irreversible rise in interest rates, and AI companies failing to secure funding," adding that "it still appears to take time before those warning signs become reality."
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dschoi@fnnews.com Choi Du-seon Reporter