By Sherry Qin
Asian chip stocks rose sharply after the U.S. and Iran reached a conditional cease-fire, buoyed by investor sentiment about lower chip-making costs and a continued AI investment boom.
South Korea's SK Hynix surged 10% and Samsung Electronics jumped about 7% on Wednesday. Taipei-listed TSMC and United Microelectronics Corp. climbed nearly 5% each. In Hong Kong, SMIC, China's largest chip foundry, advanced more than 9% and Hua Hong Semiconductor soared 14%.
The U.S. and Iran on Tuesday agreed to a two-week cease-fire, with Tehran agreeing to allow ships "safe passage" through the Strait of Hormuz, a key waterway for global energy and commodity transportation.
The development is a boon for Asian chip makers, as the industry has been concerned about disrupted supplies of helium--a byproduct of natural-gas production that is key to semiconductor manufacturing--if the Middle East conflict drags on. Helium's unique cooling properties make it difficult to substitute, and companies tend to have only limited reserves, as the gas is hard to store.
Fitch Ratings has estimated that South Korea is the most vulnerable, having sourced about 65% of its helium imports from Qatar last year, which accounted for about a third of the market. Taiwan faces similar risks because it relies on Qatar for a significant share of its helium supply, according to Fitch.
Still, even if Qatar's facilities restart after the conflict ends, normal deliveries could take weeks to months to resume, Fitch analysts said in a note.
Shares of South Korea's memory giants have been the most sensitive to developments in the Middle East, with Samsung and SK Hynix losing more than $300 billion in market capitalization combined last month, given their already expensive valuation amid the memory shortage.
A cease-fire and a potential deal between the U.S. and Iran could also dispel global hyperscalers' concerns about AI investment. Capital Economics reckons that the Iran war could take some momentum out of the AI investment boom, though the overall buildout is undisrupted.
Higher energy prices raise the cost of manufacturing advanced chips and running AI infrastructure, particularly for Asia's energy-importing economies such as Taiwan and South Korea.
"Given the negative market reaction to some big tech firms' capex plans following earnings calls earlier this year, even the hyperscalers might be forced to put those plans on ice if a further surge in costs coincided with more meaningful weakness in global equity markets," economists at Capital Economics said.
Write to Sherry Qin at sherry.qin@wsj.com
(END) Dow Jones Newswires
April 07, 2026 23:28 ET (03:28 GMT)
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