South Korean stocks experienced a significant surge in early trading on Thursday, triggering buy-side sidecars on both the KOSPI and KOSDAQ exchanges. Investors are reacting to positive global cues and potential geopolitical developments.
The benchmark KOSPI opened with a 3.09 percent increase, reaching 5,250.92 compared to the previous trading session, according to the Korea Exchange. The index rapidly extended its gains after the market opened, climbing 10.82 percent to 5,644.91 as of 9:40 a.m. KST. Earlier in the session, it reached an intraday high of 5,715.3.
Due to the sharp early rally, buy-side sidecars were activated on both the KOSPI and KOSDAQ at 9:06 a.m. KST. This marked the third such instance this year for the KOSPI and the fourth for the KOSDAQ, indicating significant market volatility.
Major market players that had previously experienced declines exceeding 10 percent led the recovery. Shares of Samsung Electronics and SK hynix saw substantial increases of 13.88 percent and 14.61 percent, respectively, while Hyundai Motor shares rose by 13.17 percent. Most large-cap stocks extended their gains in early trading.
The substantial opening rally is attributed to positive overnight performance on Wall Street. US equities closed higher following reports of behind-the-scenes discussions between Washington and Tehran. Tech stocks, particularly Tesla and Amazon, led the gains, rising by 3.44 percent and 3.95 percent, respectively.
Foreign investors spearheaded the KOSPI rally, net purchasing 744.1 billion won ($509 million USD) worth of shares in early trading. Retail investors also contributed with net purchases of 481.2 billion won, while institutional investors were net sellers, offloading 1.15 trillion won on the exchanges.
The tech-heavy KOSDAQ also opened higher, increasing by 4.64 percent to 1,023.84. After reaching a high of 1,091.98, it was up 10.35 percent at 1,079.71 as of 9:40 a.m. KST.
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