Seoul: South Korean stocks closed over 1 percent lower Thursday as investors took profit following strong gains in the previous session despite an overnight rally on Wall Street. The local currency gained against the U.S. dollar. The benchmark Korea Composite Stock Price Index (KOSPI) dropped 31.57 points, or 1.24 percent, to close at 2,515.49.
According to Yonhap News Agency, trade volume was moderate at 594.7 million shares worth 9.7 trillion won (US$6.751 billion), with decliners outnumbering gainers 696 to 190. Institutions and foreign investors combined unloaded a net 820 billion won, while retail investors purchased a net 757.8 billion won.
Overnight, U.S. stocks were buoyed by optimism surrounding joint artificial intelligence (AI) investments by OpenAI, Oracle, and SoftBank, which was highlighted by President Donald Trump. The S and P 500 rose 0.61 percent, reaching its highest level in over a month, while the Dow Jones Industrial Average and Nasdaq climbed 0.30 percent and 1.28 percent, respectively.
Analysts indicated that the sell-off was likely prompted by strong gains in the previous session. On Wednesday, the KOSPI rose 1.15 percent to reach a two-month high due to eased U.S. tariff concerns. Han Ji-young, an analyst at Kiwoom Securities, noted that investors also seemed to have adjusted their investment portfolios ahead of the extended Lunar New Year holiday, starting Saturday.
In Seoul, most shares lost ground, with losses led by chipmakers. Market heavyweight Samsung Electronics plummeted 1.1 percent to 53,700 won, while chip rival SK hynix plunged 2.66 percent to 219,500 won despite having reported strong earnings before the market opened. Shipbuilders and steelmakers also retreated, with top steelmaker POSCO Holdings falling 1.7 percent to 259,500 won, and Hanwha Ocean slipping 2.65 percent to 51,500 won.
Bio-related shares, however, advanced, with industry leader Samsung Biologics surging 3.85 percent to 1,053,000 won after reporting record earnings in the previous session. The local currency was trading at 1,437.3 won against the U.S. dollar at 11:20 a.m., up 0.3 won from the previous session.