Seoul’s stock market reached an unprecedented peak on Wednesday, with the benchmark Kospi index closing just shy of the significant 6,700-point milestone. This remarkable surge was primarily driven by robust investor optimism, who are banking on persistent demand for semiconductor chips amidst the burgeoning artificial intelligence (AI) revolution.
The Korea Composite Stock Price Index (Kospi) saw a substantial gain of 49.88 points, or 0.75 percent, propelling it to a new all-time high of 6,690.90. The index even touched an intraday high of 6,716.20, marking its third consecutive day of impressive gains in the South Korean stock market.
Trading activity was notably vigorous, with a total volume of 712.3 million shares exchanged, valued at approximately 31 trillion won ($21 billion). Advancing stocks outnumbered declining ones, with 478 winners against 362 losers. While foreign investors divested 606.9 billion won worth of local shares, domestic retail investors and institutional buyers significantly bolstered the market, scooping up 167.4 billion won and 477.7 billion won, respectively.
Initially, the Kospi began the trading day with a dip, mirroring overnight losses seen on Wall Street. This initial downturn was largely attributed to a slump in major tech stocks, following reports that an OpenAI executive, associated with ChatGPT, had raised concerns regarding its revenue and user growth targets.
However, the market sentiment in Seoul took a positive turn in the afternoon. The Financial Times reported that global investors are increasingly confident in a sustained boom for memory chip manufacturers, driven by the continuous and expanding demand for AI technologies.
This current record-breaking performance of the South Korean stock market represents a strong recovery, especially after it endured a severe downturn following the escalation of the conflict in the Middle East.
After crossing the 5,000-point threshold in late January and further reaching 6,000 points in February, the Kospi had unfortunately erased most of these gains in March, amidst heightened tensions from the US-Iran conflict.
Yet, renewed hope and sustained confidence in the future of the AI boom, coupled with eased geopolitical tensions in the Middle East, have reignited interest and pushed up major technology sector shares.
Market leader Samsung Electronics, globally recognized as the leading memory chipmaker, saw its shares climb by 1.8 percent to 226,000 won. The company successfully pared earlier losses that followed the initial market report.
Conversely, its primary chipmaking competitor, SK Hynix, experienced a slight dip, falling 0.54 percent to 1.29 million won.
“Just an hour after the Financial Times report was published, foreign investors, who had been aggressively selling over 400 billion won in the Kospi’s electrical and electronics sector, significantly reduced their sell-offs to approximately 100 billion won,” noted Seo Sang-young, an insightful analyst at Mirae Asset Securities, highlighting the immediate impact of the news on the South Korean market.
Beyond the memory chip giants, other tech and industrial firms also performed strongly. AI investment specialist SK Square saw its shares jump 2.34 percent to 830,000 won, while LS Electric surged impressively by 4.4 percent to 273,000 won.
Shares in heavy industry sectors also registered significant gains. Power plant equipment manufacturer Doosan Enerbility rose by 1.1 percent to 129,000 won, and defense industry leader Hanwha Aerospace climbed 1.79 percent to 1.42 million won.
Major shipbuilder HD Hyundai Heavy soared 3.45 percent to 690,000 won, and defense technology innovator Hyundai Rotem spiked an impressive 7.98 percent to 264,000 won.
LG Chem escalated 3.43 percent to 407,500 won, and battery manufacturing powerhouse Samsung SDI surged 4.71 percent to 712,000 won, reflecting broad-based sector strength.
However, not all companies followed the upward trend. Samsung Biologics recorded a loss of 2.06 percent, closing at 1.47 million won, and Korea Zinc shares dropped 1.41 percent to 1.6 million won. Hanmi Semiconductor also dipped by 2.59 percent, settling at 357,500 won.
