Asia's tech giants give AI bull run a new centre of gravity

• Samsung's first-quarter profit increased eightfold with chips accounting for 94% of record 57.2 trillion won total; SK Hynix market cap surged from under $100 billion 16 months ago to nearly $800 billion
• Taiwan's GDP jumped 13.69% in Q1 (biggest in nearly four decades) and South Korea's rose 1.7% (fastest in nearly six years), with many Taiwan companies' production capacities fully booked through 2027
• Leveraged buying has reached record levels with a Hong Kong-listed SK Hynix ETF becoming the world's second-largest single-stock leveraged ETF, drawing $5.11 billion in seven months, prompting warnings the market is 'getting dangerous'

Summary: Asia's Tech Giants Give AI Bull Run a New Centre of Gravity

Key Developments:

Asian chipmakers are driving a dramatic stock market rally, with South Korea's KOSPI doubling in six months and becoming the world's hottest market. The region's three most valuable companies—TSMC, Samsung Electronics, and SK Hynix—have posted record earnings, highlighting their critical role in the global AI supply chain.

Financial Performance:

• Samsung's Q1 profit surged eightfold to 57.2 trillion won, with chips generating 94% of revenue
• Chip revenues at Samsung jumped nearly 50-fold last quarter
• Samsung's market cap exceeded $1 trillion, surpassing Berkshire Hathaway
• SK Hynix, valued below $100 billion 16 months ago, is approaching $800 billion

Economic Impact:

Taiwan's Q1 GDP jumped 13.69%—the largest increase in nearly four decades—while South Korea's GDP grew 1.7%, the fastest in nearly six years. Production capacities for many Taiwan companies are fully booked through 2027.

Market Dynamics:

Both retail and institutional investors are piling into Asian tech stocks through leveraged bets. A Hong Kong-listed SK Hynix ETF attracted HK$40 billion ($5.11 billion) in seven months, becoming the world's second-largest single-stock leveraged ETF. Multi-year supply agreements signal extended AI cycle expectations.

Risks:

Analysts warn of potential overheating. Global investors withdrew nearly $50 billion from South Korean and Taiwanese stocks in March, with only $7 billion returning since. Concerns center on whether AI firms can sustain fundraising levels needed to support chipmaker spending and future earnings growth.