South Korea's stock market staged a powerful rebound after a last-minute deal averted a strike that threatened to disrupt global memory chip supply. Samsung Electronics and its union reached a tentative agreement late Wednesday to resolve a months-long wage dispute, avoiding a planned 18-day strike involving some 48,000 employees.
Market sentiment around artificial intelligence (AI) also received a boost from U.S. chip giant Nvidia, which posted record net income of $58.3 billion in the previous quarter. The benchmark KOSPI index surged over 8% on Thursday, adding to an impressive rally that has seen the index gain more than 80% since the start of the year.
Samsung Electronics, South Korea's largest company by market capitalization, saw its shares jump more than 7.5%. Meanwhile, SK Hynix, Samsung's main rival in the memory chip business, rose more than 11%. Non-tech stocks also posted big gains, with automakers Hyundai Motor and Kia each climbing about 13%.
Samsung Electronics is the world's largest memory chip maker and a key player in the AI boom. According to market research firm TrendForce, the Suwon-based company accounted for more than a third of the global DRAM market and over a quarter of the NAND flash market last year. Like other tech giants, Samsung Electronics has posted record profits thanks to surging demand for AI chips. The company's chip division saw operating profit jump nearly 50-fold in the first quarter to nearly 54 trillion won ($35 billion).
Unionized Samsung workers had for months demanded a share of the company's booming revenue. Under the proposed wage deal reached Wednesday, which still requires approval from union members, workers will receive 10.5% of the company's operating profit.
