Memory Chip Stocks Retreat Amid Rising Rates and Oil Prices
SK Hynix, Micron, and Western Digital faced significant intraday losses as macro headwinds outweighed recent strong earnings and positive analyst coverage.
Shares of SK Hynix (NASDAQ:SKHY) declined 5% to $189.47 on Thursday, leading a broader selloff in the memory chip sector. The drop occurred despite JPMorgan initiating coverage with an Overweight rating and a $245 price target. According to data from GN stocks/nasdaq, the pullback interrupted a strong recent run, with the company’s American depositary shares still up 40% over the past month.
The decline was mirrored across the sector, with Micron Technology (NASDAQ:MU) sliding 3% to $999.24 and Western Digital Corporation (NASDAQ:WDC) falling 3% to $465.50. Samsung Electronics also traded lower in Seoul during a broader risk-off session in South Korea. The Roundhill Memory ETF (CBOE:DRAM) dropped 3%, reflecting the concentrated weakness in the group, while the SPDR S&P 500 ETF Trust (NYSEARCA:SPY) fell only 0.57%, indicating that the losses were specific to the memory complex rather than the broader market.
Macro Headwinds Override Analyst Optimism
Rising interest rates and oil prices have taken precedence over fundamental business updates. The yield on the 10-year Treasury note rose to 4.91%, while WTI crude oil pushed above $100 per barrel due to renewed geopolitical tensions in the Middle East. Wholesale inflation data met expectations, setting the stage for upcoming consumer price data and a Federal Reserve meeting next week, where markets anticipate a potential rate hike.
In South Korea, foreign investors acted as net sellers, causing both Samsung Electronics and SK Hynix to close lower. The Bank of Korea has noted that these two chipmakers account for more than half of the KOSPI index, meaning local risk-off sentiment transmits directly to their U.S.-listed counterparts. This contrasts with the previous day, when the group rallied after Goldman Sachs suggested the worst of the memory downturn may be behind them.
Strong Earnings Support Long-Term Uptrend
Despite the intraday slide, the underlying demand for memory chips remains robust. Micron reported fiscal Q3 2026 revenue of $41.46 billion and non-GAAP EPS of $25.11. The company provided fiscal Q4 2026 guidance for revenue of $50 billion, plus or minus $1 billion. CEO Sanjay Mehrotra attributed the results to the strategic value of memory in the AI era.
Western Digital delivered fiscal Q4 2026 revenue of $3.75 billion and non-GAAP EPS of $3.56. The company guided fiscal Q1 2027 revenue to $4.1 billion, plus or minus $100 million. These figures, combined with SK Hynix’s recent performance, frame the current price action as a temporary reversal within a broader uptrend driven by AI data-center buildout.
Investors Watch Fed and Inflation Data
Immediate catalysts include upcoming consumer price data and the Federal Reserve meeting next week. With 20-year and 30-year Treasury yields closing at 5.3% on September 9, investors are monitoring for signs that long-end yields may cool. Maintaining position-sizing discipline is recommended for managing exposure to memory stocks as these macro data points are released.
