Seoul: South Korean stocks surged more than 2 percent Friday to close at an all-time high, driven by strong gains in large-cap semiconductor shares. The local currency weakened against the U.S. dollar.

According to Yonhap News Agency, the benchmark Korea Composite Stock Price Index (KOSPI) rose 95.46 points, or 2.27 percent, to close at 4,309.63, surpassing the 4,300 level for the first time in history. The previous record was set on November 3, when the index closed at 4,221.87 amid optimism over artificial intelligence (AI)-driven growth.

Trade volume was moderate, with 400.33 million shares exchanged, valued at 17.27 trillion won (approximately US$11.97 billion). Losers outnumbered winners 522 to 371. The index began the session positively and extended its gains as offshore investors switched to a net buying mode.

Foreign investors purchased a net 644.68 billion won worth of shares, while individual and institutional investors sold a net 454.43 billion won and 233.37 billion won worth of shares, respectively. Analysts indicated that strong exports helped counterbalance recent weaknesses in U.S. equities, while investors capitalized on continued momentum from AI advancements.

In 2025, exports achieved an all-time high of $709.7 billion, surpassing the $700 billion mark for the first time, fueled by growth in AI and the semiconductor industry, as revealed by government data. Kim Yong-gu, an analyst at Yuanta Securities, stated, "The KOSPI is expected to trade in a neutral-to-positive tone, supported by a virtuous cycle of global growth, sales and earnings, along with the government's full-scale efforts to stimulate the economy and the stock market."

On Wednesday (U.S. time), U.S. shares ended lower on the final trading day of 2025. The Dow Jones Industrial Average dropped 0.63 percent, while the tech-heavy Nasdaq composite slid 0.76 percent.