Foreign Investors Turn Back On No Longer Fetching Chips

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Foreign Investors Turn Back On No Longer Fetching Chips

Shifting their position, foreign investors have begun selling Korea's key semiconductor shares, with international chip prices headed south.

The spot price of a 128-megabit dynamic random access memory, or DRAM, chip has fallen below $3, sparking heavy foreign selling of shares in Samsung Electronics Co. and Hynix Semiconductor Inc. Overseas investors purchased more than 120,000 shares of Samsung on Tuesday, which marked a departure from Hynix in which foreign investors had bought 85 million shares over three consecutive sessions.

This month, foreigners have shifted from buying to selling at two to five-day intervals on Samsung and five to seven-day intervals on Hynix.

Analysts attribute the repetition to falling chip prices amid expectation semiconductors will recover this year.

Global chip prices have been on the decline since April. Worse yet, the spot price fell even further Tuesday on speculation that International Business Machine will unload its inventory of chips in the market.

"Chip prices fell steeper than expected, and this year's DRAM market is forecast to shrink 42 percent to $16.7 billion," said Woo Dong-jeh, a senior researcher at Hyundai Securities Co. "But they are expected to stabilize in the third quarter, before recovering in the fourth quarter."



by Chung Jeh-hong

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