South Korean chip stocks gained ground on Wednesday morning, buoyed by Nvidia Corp.’s announcement of a massive artificial intelligence (AI) chip supply deal with Saudi Arabia.

SK hynix Inc. shares were trading 3.78 percent higher at 206,000 won ($145.7) as of 10:26 a.m. on Wednesday, while those of Samsung Electronics Co. were trading 0.7 percent higher at 57,300 won. Hanmi Semiconductor Co. stock soared 2.1 percent to 82,700 won, and EO Technics Co.’s shares jumped 2.76 percent to 134,200 won.

The rally is attributable to improved investor sentiment following Nvidia’s announcement that it plans to sell more than 18,000 units of its advanced AI chip, GB300 Blackwell, to Humain, which is owned by Saudi Arabia’s Public Investment Fund.

According to CNBC, this announcement, which came during U.S. President Donald Trump’s visit to the Middle East, reflects how Nvidia chips are being used as diplomatic tools in a global race to secure the hardware needed to develop and run advanced AI models like ChatGPT.

Nvidia’s stock surged 5.63 percent on the New York Stock Exchange overnight. Other major chip stocks also gained - Broadcom Inc. shares increased 4.89 percent, ASML Holding N.V. shares rose 1.83 percent, and those for Advanced Micro Devices, Inc. rose 4.01 percent. The Philadelphia Semiconductor Index, which tracks major global chipmakers, was up 3.15 percent from the previous session at market close.

For its part, POSCO Future M, in the meantime, saw its stock plunge by more than 5 percent on Wednesday morning following its announcement of a 1.1 trillion won rights offering.

The shares were trading at 113,500 won as of 10:35 a.m., down 5.5 percent from the previous session. They fell over 6 percent immediately after the market opened and at one point dropped as much as 6.91 percent.

POSCO Future M board of directors approved a shareholder-allotted capital increase to secure future growth engines on Tuesday. The funds will be used to expand a joint cathode materials plant in Canada and increase production capacity at its Pohang and Gwangyang cathode/anode plants.

SK Hynix shares closed at 206,000 won, Samsung Electronics shares closed at 57,400 won, Hanmi Semiconductor shares closed at 83,800 won, and EO Technics Co. shares closed at 134,400 won, while POSCO Future M shares closed at 115,300 won.

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