South Korean stocks experienced a significant surge of over 5% on Wednesday, fueled by a robust semiconductor rally. This rally was further propelled by the ongoing global artificial intelligence conference hosted by US chip giant Nvidia. Concurrently, the Korean won strengthened against the US dollar.
The benchmark Korea Composite Stock Price Index (KOSPI) closed at 5,925.03, marking an impressive gain of 284.55 points, or 5.04%.
The KOSPI saw strong buying pressure from foreign and institutional investors, leading the Korea Exchange (KRX), the country’s primary stock market operator, to issue a buy-side sidecar near the market close.
According to the KRX, program trading for the KOSPI was temporarily suspended for five minutes at 2:34 p.m.
Offshore and institutional investors collectively purchased a net total of 4 trillion won ($2.7 billion) worth of equities. Conversely, retail investors offloaded 3.9 trillion won.
Trading volume was substantial, with 1.1 billion shares changing hands for a total value of 26.1 trillion won. Gainers significantly outnumbered losers, with 614 stocks advancing compared to 278 declining.
Lee Kyoung-min, an analyst at Daishin Securities, attributed the increased investor appetite for semiconductors to recent comments made by Nvidia’s CEO, Jensen Huang, regarding Samsung Electronics.
During the ongoing four-day event in California, Huang stated on Monday that he wanted to “thank Samsung, who manufactures the Groq LP30 chip” for the company, noting that the chips are currently in production and are expected to ship in the second half of the year.
“The stock market’s sensitivity to geopolitical issues in the Middle East is markedly declining,” Lee added.
The majority of large-cap shares finished the day with gains.
Leading company Samsung Electronics surged 7.53% to close at 208,500 won, while its rival in chip manufacturing, SK hynix, climbed 8.87% to 1,056,000 won.
Nuclear power plant builder Doosan Enerbility rose 2.78% to 107,300 won, driven by expectations that alternative energy sources would benefit from the recent surge in oil prices.
Brent crude, the international benchmark for oil prices, has remained above the US$100 per barrel level for the past five trading sessions.
In contrast, defense shares experienced losses as investors sought to capitalize on profits. Hanwha Aerospace edged down 0.43% to 1,390,000 won, and LIG Nex1 retreated 2.27% to 689,000 won.
