SK Hynix, one of the most valuable companies in South Korea, on Wednesday announced that it would buy back and cancel treasury shares worth 40 trillion won (around Rs 2.75 lakh crore) after the heavyweight stock crashed around 50% in less than two months, pushing the country’s stock market sharply down and wiping off significant portions of investors’ wealth.
South Korea’s massive seesaw market has grabbed the headlines this year, skyrocketing a whopping 122% since the beginning of the year to hit a lifetime high in June, before things began to go downhill. Analysts pointed out the concentration of chipmakers Samsung Electronics and SK Hynix, which make up just over half of the benchmark Kospi. The final nail in the coffin seemed to be the single-stock leveraged ETFs linked to these two chipmakers, which further increased concentration risks, leading to the Kospi spiralling down.
