KOSPI Climbs 1.14% as US Chip Rally Lifts Samsung, SK Hynix
Korean equities rose 1.14% Monday, driven by a surge in US semiconductor stocks and sustained foreign net buying.
Key points
- KOSPI rose 1.14% to 6,972.95, driven by a 2.78% gain in the US Philadelphia semiconductor index.
- Foreign investors bought 45.3 billion won in Korean stocks, marking their first net buying in eight trading days.
- Samsung Electronics and SK hynix shares increased by 2% and 1% respectively, tracking US chip sector strength.
The KOSPI index opened higher on Monday, trading at 6,972.95 as of 9:04 a.m., representing a gain of 78.72 points or 1.14% from the previous close. According to Chosunbiz, this upward movement was primarily fueled by a rally in technology stocks on US markets during the previous session, which helped offset persistent headwinds from elevated oil prices and government bond yields.
Market participation showed a clear shift in institutional behavior. Foreign investors and other corporations emerged as net buyers, accumulating 45.3 billion won and 21.3 billion won respectively. This marked the first time foreign investors turned to net buying in eight trading days, extending their positive streak to two consecutive sessions. Conversely, individual investors and domestic institutions acted as net sellers, distributing 13.8 billion won and 52.9 billion won respectively.
Semiconductor Leaders Lead Market Gains
South Korea’s major chipmakers drove the index higher, mirroring the performance of their US counterparts. Samsung Electronics shares rose by 2%, while SK hynix gained 1%. The primary driver was a strong showing in the Philadelphia semiconductor index, which climbed 2.78% on the previous session. This gain was supported by significant increases in peers such as SanDisk, which jumped nearly 11%, and Micron, which rose almost 4%.
The strength in the semiconductor sector provided a specific catalyst for Korean equities, particularly SK hynix ADRs, which also posted a 2.46% increase. This sector-specific momentum helped lift overall investor sentiment, allowing the broader market to expand its gains despite a mixed close in the broader US indices, where the S&P 500 rose only 0.17% and the Dow Jones Industrial Average fell 0.18%.
Macro Headwinds Remain Elevated
Despite the equity gains, macroeconomic conditions remain challenging for the domestic market. International oil prices stayed high despite slight declines, with November delivery Brent futures falling to $103.87 from a recent peak above $108. Similarly, October delivery West Texas Intermediate crude dropped to $100 per barrel. The US 10-year Treasury yield also closed at 4.996%, indicating that fixed-income returns remain attractive relative to equities.
KOSDAQ Flat Ahead of Holiday
The KOSDAQ index showed little movement, trading flat at 826.17 with a negligible change of 0.05 points. Trading activity in this smaller-cap index was characterized by a standoff between investor groups. Individuals were net buyers with 64.5 billion won in purchases, while foreign investors and institutions were net sellers, distributing 37.3 billion won and 21.7 billion won respectively.
Market analysts warn that the upcoming Chuseok holiday may exacerbate liquidity issues. Researcher Han Ji-young from Kiwoom Securities noted that the short trading week could lead to a supply-demand vacuum, increasing the likelihood of volatility as trading volumes decline and order books thin out in the days leading up to the break.
