South Korean equities achieved a remarkable feat on Monday, extending their rally to a fresh all-time high, primarily fueled by significant advancements in artificial intelligence (AI) related stocks. Concurrently, the local currency demonstrated strength, appreciating against the US dollar.
The benchmark Korea Composite Stock Price Index (KOSPI) surged by 311.85 points, marking a substantial 3.68 percent increase, to close at 8,788.38. This impressive close followed an earlier breach of a new intraday high, reaching 8,874.16.
The KOSPI opened at a record high and sustained its upward momentum, leading the Korea Exchange to trigger a buy-side sidecar. This mechanism temporarily halted program trading of KOSPI stocks for five minutes around 11:30 a.m., reflecting the market’s intense activity.
Trading volume was exceptionally robust, with 618.17 million shares exchanged, valuing 69.4 trillion won ($46.1 billion). Despite the overall market rally, decliners slightly outnumbered advancers, with 712 stocks falling against 194 gaining.
Domestic institutional and individual investors showed strong confidence, net buying 2.53 trillion won and 377.31 billion won respectively. In contrast, foreign investors offloaded a net 2.91 trillion won from the South Korean market.
Geopolitical tensions also played a role in global market dynamics; ongoing negotiations between the United States and Iran aimed at resolving conflict and reopening the Strait of Hormuz saw no significant breakthrough over the weekend, which contributed to an uptick in international oil prices.
Nonetheless, the robust rally in chipmakers underscored investor confidence, as they brushed aside concerns from the Middle East talks, betting on the sustained momentum of the AI-driven semiconductor boom.
Further bolstering the positive economic outlook, South Korea’s exports experienced an extraordinary surge in May, climbing 53 percent year-on-year to reach a new monthly record of $87.8 billion. Government data attributed this stellar performance to the powerful semiconductor supercycle.
Robot and AI-related equities saw substantial gains, driven by anticipations of potential partnership opportunities. This excitement precedes the highly anticipated visit of US chip giant Nvidia Corp. CEO Jensen Huang to South Korea later this week.
During the recent Computex conference in Taipei, Nvidia CEO Jensen Huang announced that the company’s “Vera” central processing unit, specifically designed for AI agents, will integrate high-bandwidth memory (HBM) chips supplied by leading manufacturers: Samsung Electronics, SK hynix, and Micron.
“Huang’s pivotal announcement regarding the Vera chip, combined with widespread anticipation surrounding his upcoming visit to South Korea, has significantly energized investor sentiment toward chipmakers. Notably, Samsung Electronics, whose shares had recently lagged behind SK hynix, experienced a sharp rally,” observed Lee Kyung-min, an esteemed analyst at Daishin Securities.
He further elaborated, “It appears that large-cap AI and robotics-related stocks are spearheading the broader market’s gains, propelled by expectations of potential strategic collaborations with Nvidia.”
Market bellwether Samsung Electronics surged by an impressive 10.09 percent, reaching a record high of 349,000 won. Its rival chipmaker, SK hynix, also posted gains, climbing 1.29 percent to 1.36 million won.
Beyond the semiconductor sector, top automaker Hyundai Motor advanced 3.73 percent to 750,000 won, while AI investment firm SK Square saw its shares rise 1.87 percent to 1.25 million won.
Adding to the excitement, LG Electronics skyrocketed by 29.86 percent to 380,500 won, and internet portal operator Naver surged 16.03 percent to 271,500 won. These dramatic increases were fueled by market speculation and reports suggesting that their respective chiefs might engage in discussions with Jensen Huang regarding potential AI partnerships.
