The momentum continues! Japanese and South Korean stock indices hit record highs. SK Hynix joins the "trillion-dollar club".

Influenced by the investment frenzy in artificial intelligence (AI) and the situation of the Middle East GEO Group Inc, Asian stock markets generally rose on Wednesday, with major stock indices in Japan and South Korea hitting new historical highs. In particular, the stock price of South Korean chip giant SK Hynix soared, making it the third company in Asia with a market value exceeding one trillion US dollars. Data shows that the Nikkei 225 index in Japan rose over 2% at one point, hitting a new historical high, while the TOPIX index also rose nearly 1%. The Korea Composite Stock Price Index (KOSPI) surged 5% driven by SK Hynix, triggering a circuit breaker, also setting a record. The optimistic sentiment in the market was partly based on a cautious assessment of the situation in the Middle East. The US Department of Defense confirmed that on Tuesday, the US military conducted strikes in southern Iran under the name of "self-defense," targeting missile launch sites and Iranian vessels attempting to deploy sea mines. However, Washington also emphasized that the US is still exercising restraint within the existing ceasefire framework. President Trump mentioned on Monday that negotiations aimed at ending the war are "progressing well," but also warned that if the negotiations fail, the US military may shift to an offensive stance. This complex situation makes the prospect of a ceasefire agreement still fragile, but the market seems to be more inclined to bet on the agreement eventually being reached. In the previous day's trading, the US stock market had already responded positively. Boosted by tech stocks, both the S&P 500 and Nasdaq Composite indices hit new historical highs on Tuesday, with the S&P 500 closing at 7519.12 points and the Nasdaq closing at 26656.18 points. Only the Dow Jones Industrial Average fell slightly by 0.23%. SK Hynix joins the "trillion-dollar club" Compared to the uncertainty of GEO Group Inc's politics, the strong fundamental demand brought by AI computing power became the core driving force behind the record performance of the Korean stock market. As the most crucial high-bandwidth memory (HBM) supplier for NVIDIA Corporation, SK Hynix's stock price surged over 11% in Wednesday's trading, propelling its market value to historically surpass the trillion-dollar mark. This makes SK Hynix the third Asian company to join the "trillion-dollar club" after Samsung Electronics at the beginning of the month. Its US competitor Micron Technology, Inc. also reached this milestone this week. SK Hynix has firmly positioned itself on the critical path of global AI expansion. HBM memory chips have become a key bottleneck restricting the speed of data center expansion, and market analysis generally expects this tight supply-demand situation to continue until 2027, giving storage giants like SK Hynix extraordinary pricing power over major global tech companies. SK Hynix's stock price has accumulated an amazing increase of over 900% in the past year, with an increase of about 250% since the beginning of 2026. The latest data shows that in the fourth quarter of last year, SK Hynix accounted for 57% of the global HBM market by revenue, followed closely by Samsung Electronics and Micron Technology, Inc. with market shares of 22% and 21%, respectively. In April this year, the company reported a fivefold increase in quarterly profits and predicted that the demand for HBM would continue to exceed supply for the next three years. Barclays analysts pointed out in a recent report that they expect SK Hynix to continue to maintain its leading position in the HBM field and that the pricing environment for its products remains favorable. Richard Clode, portfolio manager at Janus Henderson, said, "Semiconductor stocks have seen an unusually rapid rise since the low point at the end of March, with storage stocks leading this rally. For storage stocks, this rise is reasonable because the extremely strong demand for AI is driving record profit margins, combined with the signing of long-term contracts, making this cycle more sustainable." Despite such a rapid rise, SK Hynix's current stock price is still only equivalent to six times the expected earnings for the next 12 months, far lower than the Philadelphia Semiconductor Index's 27 times. Cha So-Yoon, stock investment manager at Seoul's Taurus Asset Management, said that based solely on earnings momentum, it is difficult to predict the recent top, and many investors are looking at an upward space with a price-earnings ratio of 10 times. Optimism about the company's outlook also comes from its global expansion. SK Hynix has submitted plans to issue American Depositary Receipts (ADRs) for listing in New York this year, which if successful, will be one of the largest foreign listings in the US in recent years. In addition, the company has announced the establishment of an AI solutions department in the US and pledged to invest at least $10 billion to further deepen its core position in the global AI supply chain.