Global Banks Curb Leverage on Korean Chip Stocks Amid Volatility Fears

In a move reflecting growing caution toward the AI-driven tech rally, major global investment banks have begun restricting hedge funds' ability to use leverage for bullish bets on Asian semiconductor giants. Institutions including Citigroup, JPMorgan, and Goldman Sachs raised swap financing costs for SK Hynix and Samsung Electronics shares, with rates reaching as high as 15%, or 11% over the SOFR benchmark. Furthermore, Morgan Stanley has reportedly stopped accepting new swap orders for the two Korean stocks, with similar restrictive steps taken for TSM to mitigate exposure to high-volatility trades.

These restrictions follow a period of massive speculative momentum in the chip sector, as lenders seek to insulate themselves from potential forced liquidations during market corrections. Per market data, JPM closed at $320.235 and TSM at $425.9 on June 12, 2026, while Goldman Sachs (GS) stood at $1,035.64 as of the June 11 close. Analysts suggest the tightening is a direct response to the 'FOMO' dynamics seen in retail and hedge fund positioning, aiming to reduce bank counterparty risk as valuations in the semiconductor space reach multi-year highs.

Traders should closely watch liquidity levels in the affected Korean equities, as higher financing costs may trigger deleveraging-driven sell-offs. Based on closing prices on June 11, 2026, Morgan Stanley (MS) was at $212.66 and Citigroup (C) at $138.07. Looking ahead, the economic calendar shows no major central bank catalysts for the sector in the next seven days, meaning price action will likely be driven by institutional flow adjustments and broader tech sector sentiment.