Nvidia’s Strong Earnings Could Boost Korean Won, SK Hynix: Will Exports Soar?, South Korea

Date:

Nvidia’s Strong Earnings Could Boost Korean Won, SK Hynix: Will Exports Soar?

AI chipmaker Nvidia Corp. has exceeded expectations with its recent earnings announcement, potentially providing a much-needed boost for the tech-reliant Korean won. The Korean currency has experienced a difficult month, becoming Asia’s worst-performing currency due to declining exports, disappointing Chinese growth, and higher US yields. With the hope that Nvidia’s impressive sales forecast indicates a broader demand for AI processors, the industry’s suppliers, such as SK Hynix Inc., could experience a surge in exports.

Following Nvidia’s positive results, the Korean won strengthened by 1.3% against the dollar, while SK Hynix’s shares increased by 4.2%. Investors are now eagerly awaiting Korea’s trade data for August to gauge the impact on the country’s economy. Preliminary figures from the first twenty days of the month indicate a 16.5% decline compared to the previous year.

The correlation between the stock price of Korean chipmakers and the dollar-won exchange rate is seen as negative by experts. Min Joo Kang, a senior economist at ING Bank NV in Seoul, suggests that Nvidia’s performance will have a short-term impact on the currency until there is either disappointing data or news about China’s economic slowdown.

Kang predicts that the Korean won will rise to 1,300 against the dollar by the end of the third quarter. However, the currency still faces challenges due to China’s slowing economy, which is Korea’s largest export market. If China’s manufacturing PMI for August remains in contractionary territory for a fifth consecutive month, pressure on the won could resurface as early as this week.

See also  Reliance & Nvidia Partner to Bring AI Language Models & Apps to Millions of Indian Telecom Users

Despite positive signs after Nvidia’s earnings announcement, the won’s progress may be hindered by China’s economic and debt problems, which are yet to be resolved. Irene Cheung, an FX strategist at ANZ Banking Group in Singapore, believes that global semiconductors may have reached their lowest point, but the won still faces headwinds.

Key Asian economic data due this week will shed further light on the region’s economic performance and the impact on currencies such as the Korean won.

In conclusion, Nvidia’s strong earnings have the potential to boost the Korean won and benefit companies like SK Hynix. However, the currency still faces challenges posed by China’s slowing economy. Investors and analysts will closely monitor trade data and China’s manufacturing PMI for further insights into the currency’s performance.

*End of article*

Frequently Asked Questions (FAQs) Related to the Above News

How did Nvidia's earnings announcement impact the Korean won?

Nvidia's strong earnings announcement resulted in a 1.3% strengthening of the Korean won against the dollar.

What are the expectations for SK Hynix's exports following Nvidia's positive results?

It is anticipated that SK Hynix, as a supplier to the AI chipmaker Nvidia, may experience a surge in exports due to the increased demand for AI processors.

What is the correlation between the stock price of Korean chipmakers and the dollar-won exchange rate?

Experts suggest that the correlation between the stock price of Korean chipmakers, such as SK Hynix, and the dollar-won exchange rate is negative.

How do experts predict the Korean won will perform in the near future?

Senior economist Min Joo Kang predicts that the Korean won will rise to 1,300 against the dollar by the end of the third quarter.

What are the challenges facing the Korean won despite Nvidia's strong earnings?

The Korean won still faces challenges due to China's slowing economy, which is Korea's largest export market. This, along with China's manufacturing PMI remaining in contractionary territory, puts pressure on the won.

Do experts believe the won's progress will continue to be hindered by China's economic and debt problems?

Irene Cheung, an FX strategist at ANZ Banking Group, believes that while global semiconductors may have reached their lowest point, the Korean won still faces headwinds due to China's economic and debt problems.

What key Asian economic data will provide further insights into the Korean won's performance?

Key Asian economic data, such as trade data and China's manufacturing PMI, will be closely monitored to gain a better understanding of the impact on currencies like the Korean won.

Please note that the FAQs provided on this page are based on the news article published. While we strive to provide accurate and up-to-date information, it is always recommended to consult relevant authorities or professionals before making any decisions or taking action based on the FAQs or the news article.

Share post:

Subscribe

Popular

More like this
Related

Obama’s Techno-Optimism Shifts as Democrats Navigate Changing Tech Landscape

Explore the evolution of tech policy from Obama's optimism to Harris's vision at the Democratic National Convention. What's next for Democrats in tech?

Tech Evolution: From Obama’s Optimism to Harris’s Vision

Explore the evolution of tech policy from Obama's optimism to Harris's vision at the Democratic National Convention. What's next for Democrats in tech?

Tonix Pharmaceuticals TNXP Shares Fall 14.61% After Q2 Earnings Report

Tonix Pharmaceuticals TNXP shares decline 14.61% post-Q2 earnings report. Evaluate investment strategy based on company updates and market dynamics.

The Future of Good Jobs: Why College Degrees are Essential through 2031

Discover the future of good jobs through 2031 and why college degrees are essential. Learn more about job projections and AI's influence.