Seoul:Seoul shares closed higher on Monday, buoyed by institutional buying, as investors considered the implications of significant investments in artificial intelligence infrastructure.

According to Yonhap News Agency, the Korean won also strengthened against the U.S. dollar. The Korea Composite Stock Price Index (KOSPI) rebounded from an initial drop of 3.17 percent to finish up by 99.96 points, or 1.76 percent, at 5,768.01. This rise followed a previous dip to 5,488.41.

Institutional investors purchased a net 574.66 billion won (approximately US$432 million) in shares. In contrast, foreign investors and retail investors sold a net 37.87 billion won and 1.09 trillion won, respectively. Market participants remained cautious ahead of upcoming earnings reports from major firms such as Tesla and Meta Platforms, alongside the U.S. midterm elections on November 3, amidst ongoing interest rate uncertainties.

IBK Securities noted that some investors sought bargains in large-cap stocks following recent declines, pushing the index into positive territory despite concerns over AI infrastructure spending. In the tech sector, Samsung Electronics saw a 1.16 percent increase to 218,000 won, while SK hynix gained 0.39 percent to 1.28 million won. Hyundai Motor surged 4.49 percent to 326,000 won, and Hanwha Aerospace rose 1.91 percent to 905,000 won. Conversely, HD Hyundai Heavy Industries dropped 1.71 percent to 345,500 won, and Hanwha Ocean fell 1.23 percent to 64,200 won.

The Korean won was quoted at 1,330.3 against the U.S. dollar as of 330 p.m., an improvement from 1,331.4 at the previous session's close. Bond prices ended lower, with the yield on three-year Treasurys increasing by 2.3 basis points to 3.877, and the yield on five-year government bonds rising 2.6 points to 4.014.