South Korean stocks closed significantly higher on Friday, extending their bullish run for a second consecutive session. This robust performance in the Seoul stock market was primarily driven by a strong rally in leading semiconductor shares, mirroring positive gains seen overnight on Wall Street. The local currency also demonstrated strength, appreciating against the US dollar.
Following an initial period of volatile trading, the benchmark Korea Composite Stock Price Index (Kospi) surged by 184.03 points, a substantial 2.52 percent increase, to settle at 7,475.94 points at market close.
Trading volume remained moderate across the South Korean market, with 449.53 million shares exchanged, totaling 31.16 trillion won ($20.73 billion). Market breadth was overwhelmingly positive, as advancing stocks far outpaced decliners with 799 gainers against just 92 losers.
Institutional investors emerged as net buyers, acquiring 1.13 trillion won worth of shares. In contrast, individual investors and foreign investors were net sellers, offloading 772.82 billion won and 322.56 billion won worth of shares, respectively. Notably, foreign investors shifted to a net selling position after two successive sessions of net purchasing.
The Kospi opened more than 3 percent higher and climbed by as much as 5.7 percent during the trading session, a surge significant enough to trigger a buy-side sidecar. This mechanism temporarily halted program trading in Kospi-listed shares for five minutes, marking its third activation this week amid heightened market volatility.
However, the Kospi relinquished some of its early gains during afternoon trading as investors moved to lock in profits after the sharp upward movement.
Investor sentiment received a significant boost from robust overnight performances in US stocks. The positive momentum was fueled by a strong rebound within the semiconductor sector and a favorable easing of global oil prices, which alleviated broader market concerns.
On Wall Street, the Dow Jones Industrial Average posted a gain of 0.27 percent, while the broader S&P 500 index climbed 0.81 percent. The tech-heavy Nasdaq Composite, a key indicator for growth stocks, rose by 1.3 percent.
Back in Seoul, large-capitalization stocks generally recorded strong gains, contributing significantly to the overall market rally.
Semiconductor industry giant Samsung Electronics saw its shares rise by 2.52 percent, closing at 285,000 won.
Conversely, SK Hynix, another major player in the semiconductor market, edged down 0.27 percent to 2.18 million won, despite opening higher. The company is poised for a significant international debut on the tech-heavy Nasdaq through the listing of its American Depository Receipts (ADRs).
“Investor sentiment towards the critical semiconductor sector significantly improved, driven by Meta’s announced capital spending plans and Micron’s optimistic investment outlook, which collectively eased previous concerns about the industry’s future prospects,” explained Lee Kyung-min, an analyst at Daeshin Securities. Lee added, “Strong investor demand surrounding SK Hynix’s upcoming ADR offering further bolstered confidence in semiconductor stocks, providing substantial upward momentum to the broader South Korean market.”
Among other notable performers, artificial intelligence investment firm SK Square advanced robustly by 6.18 percent to 1.41 million won. Similarly, chip components manufacturer Samsung Electro-Mechanics gained a strong 6.1 percent, reaching 1.58 million won.
