South Korean financial markets witnessed significant movement on Monday as the benchmark KOSPI index recorded substantial gains, driven by strong performances from major chipmakers and renewed foreign investor interest.
Market Performance Overview
The benchmark KOSPI surged by 63.12 points, representing a 1.57% increase, to close at 4,074.69 points. This impressive performance came as foreign investors emerged as net buyers, purchasing shares worth 180.8 billion Korean won in the domestic market.
Chipmakers Lead the Rally
The market rally was primarily fueled by outstanding performances from semiconductor giants. Samsung Electronics saw its shares climb by 3.19%, while its competitor SK Hynix recorded an even more impressive gain of 6.61%. This upward momentum followed their recent commitment to bolster domestic investment after meetings with President Lee Jae Myung.
The investment pledges came at a crucial time when concerns were growing about manufacturing moving overseas due to a U.S. trade deal. In another significant development, Samsung Electronics reportedly increased prices of certain memory chips by as much as 60% compared to September levels, responding to global shortages driven by the race to build AI data centers.
Sector-wise Performance and Currency Movement
While technology stocks dominated the gains, other sectors showed mixed performance. Battery manufacturer LG Energy Solution experienced a slight decline of 0.22%, while automotive companies Hyundai Motor and Kia Corp posted modest gains of 0.18% and 0.43% respectively. Steelmaker POSCO Holdings saw a minor dip of 0.40%.
Market breadth showed 339 advancing shares against 543 declining issues out of 925 total traded stocks. In the currency markets, the Korean won weakened against the US dollar, trading at 1,457.1 per dollar on the onshore settlement platform, representing a 0.27% decrease from its previous close of 1,453.1.
Bond Market and Year-to-Date Performance
The debt markets presented a mixed picture. December futures on three-year treasury bonds gained 0.07 point to reach 105.72. The most-liquid three-year Korean treasury bond yield decreased by 1.5 basis points to 2.939%, while the benchmark 10-year yield experienced a marginal increase of 0.1 basis point to 3.314%.
Year-to-date performance metrics reveal that KOSPI has risen by an impressive 69.81% so far this year, while the Korean won has strengthened by 1.0% against the US dollar during the same period.
Among other notable movers, Lotte Tour Development shares jumped 8.7% following reports that China had warned its citizens against traveling to Japan, potentially benefiting South Korean tourism companies.
