Korean stocks soared following Samsung. The market was revitalized by the cancellation of the strike and Nvidia's report

Quotes of Samsung Electronics jumped on Ma 21 during trading in Seoul by almost 8%. The market exhaled: the union of the world's largest manufacturer of memory chips at the last moment canceled the planned 18-day strike. Investors' optimism was added by the strong report of Nvidia, CNBC points out: quarterly sales of the leader among chipmakers soared by 85%, once again exceeding the forecast of Wall Street.

Against this background, the South Korean stock index Kospi also rose by a little more than 8% (the day before it closed in the minus by 5% - under the influence of reduced investor appetite for risk due to rising yields of government bonds around the world).

Samsung and its largest union reached an agreement just an hour before nearly 48,000 employees were due to stop work. Negotiations had been stalled since late last year: at the height of the global boom in memory chips, the two sides could not agree on how to divide future bonuses from the company's AI business.

If the team approves the agreement by Ma 27, Samsung will pay employees a special bonus of 10.5 percent of operating profit with no upper limit - part of which will be given in shares. The bonus will accrue for at least 10 years, but with a condition: if the semiconductor division's annual profits exceed 200 trillion won in 2026-2028 ($132 billion) and 100 trillion won in 2029-2035, South Korea's Yonhap news agency reported.

The bonus fund will be divided as follows: 40% will be distributed among all employees in the semiconductor division, while the remaining 60% will go to specific teams for their individual performance. Yonhap estimates that if the company's profits reach the projected 300 trillion won this year, each of the division's 28,000 employees could receive up to 600 million won (about $400,000) in bonus payments. The most pressing issue - how to divide the money between the unprofitable departments - has been postponed for a year.

Analysts estimate that the strike could have cost the South Korean economy 100 trillion won (about $67 billion). The compromise relieved tension not only in South Korea itself, whose economy is critically dependent on exports, but also in global markets.For global electronics manufacturers, the shutdown of Samsung's plants would have turned into a shortage: 18 days of downtime would deprive the market of 3-4% of the supply of RAM (DRAM) and 2-3% of NAND flash memory, inevitably raising prices for components, Yonhap notes. Risks were also borne by the Korean stock exchange: since Samsung occupies about a quarter of the Kospi index, the strike threatened to bring down the entire stock market of the country, the agency stated. In trading on Ma. 21, the Kospi jumped by 8%.

This article was AI-translated and verified by a human editor