Cramer: Micron Tied to Seoul Trading, A Dislike

CNBC's Jim Cramer has expressed a dislike for how Micron Technology (MU) follows SK Hynix's moves. His remarks came right before the South Korean firm revealed its best-ever quarterly financials.

This situation leaves Micron investors exposed to market swings in Seoul, despite the company's US base. Cramer described the scenario as unfortunate.

Why Does a US Memory Stock Follow Seoul?

On Mad Money, a viewer asked whether the volatile Micron is better suited for a long-term strategy or options straddles. Cramer's response was that Micron tracks SK Hynix's trading activity in Korea.

“I’m hoping the linkage ends one day, but it hasn’t yet.”

Jim Cramer, MadMoney

This pattern was evident on Oct. 13. SK Hynix dropped 10.09% in Seoul, according to SBS, and Micron's US-listed shares subsequently fell by roughly 5%.

However, CNBC reported that Wall Street was already down that Monday, suggesting the influence could work in both directions.

Yahoo Finance pointed out that SK Hynix and Samsung Electronics together represent over half of South Korea's entire stock market value.

Common catalysts play a role too. China's ChangXin Memory Technologies (CXMT), a DRAM producer, unveiled a more compact memory-cell architecture. That CXMT chip advance impacted both companies' shares.

Additionally, both firms supply high-bandwidth memory (HBM), the chips placed next to AI processors, into the same demand environment.

Can the Link Break After SK Hynix’s Record Quarter?

On Oct. 28, SK Hynix continued Korea’s memory chip boom with its best-ever quarterly performance. Operating profit for the third quarter reached 83.33 trillion won ($62.8 billion), a 632% jump year over year. JoongAng noted this exceeded the 76.96 trillion won consensus figure.

The day before, its Seoul shares had ended nearly 8% lower. Now, how Micron reacts may reveal whether the correlation persists with positive news as well.

At least one brokerage sees an advantage in Micron's US listing. F&C Equities showed a preference for Micron back in July, citing Korean market volatility and tariff concerns.

SK Hynix's American depositary receipts (ADRs) began trading on Nasdaq in July, giving US investors a way to trade both sector leaders side by side. This development could strengthen the very overlap Cramer wishes would disappear.