Seoul: South Korean stocks saw a positive close for the third consecutive session, primarily driven by significant gains in market heavyweight Samsung Electronics and the IT sector. Meanwhile, the local currency weakened against the U.S. dollar.
According to Yonhap News Agency, the Korea Composite Stock Price Index (KOSPI) increased by 21.89 points, or 0.74 percent, concluding at 2,972.19. The trading volume was moderate, with 568.6 million shares valued at 14.4 trillion won (US$10.5 billion) changing hands. The market saw more losers than winners, with 457 stocks declining compared to 425 that advanced.
Foreign investors were net buyers, purchasing 272 billion won worth of local shares, while institutions acquired 130.6 billion won. In contrast, retail investors sold off 432 billion won, likely engaging in profit-taking activities. Market participants are closely watching to see if KOSPI can surpass the 3,000 mark for the first time in over three years, despite escalating tensions in the Middle East.
Wall Street faced declines overnight following reports that U.S. President Donald Trump demanded Iran's "unconditional surrender" and advised evacuations in Tehran, indicating potential regional instability. The conflict between Iran and Israel intensified after preemptive Israeli airstrikes on Iranian nuclear sites earlier in the week.
Experts attribute the surge in IT shares to foreign investors, influenced by the Korean government's significant investment plans in artificial intelligence (AI). Additionally, global investment bank JP Morgan's recommendation to overweight South Korean search engine giant Naver in stock portfolios bolstered confidence.
In a significant development, President Lee Jae Myung appointed Ha Jung-woo, head of the Future AI Center at Naver, as the new presidential secretary for AI policy. Following this news, Naver's stock skyrocketed by 17.92 percent to 243,500 won. Kakao, the country's leading mobile messenger operator, saw its shares jump 6.56 percent to 55,200 won, while IT and game company NHN rallied 10.46 percent to 32,200 won.
Samsung Electronics, a key player in the tech sector, rose 2.93 percent to 59,800 won. Doosan Enerbility, a leading nuclear power plant manufacturer, advanced 2.69 percent to 61,000 won. The ongoing Israel-Iran conflict also led to a 10.98 percent surge in major oil refinery SK Innovation's stock, reaching 101,100 won, as international oil prices climbed.
Conversely, chipmaker SK hynix experienced a decline of 1 percent to 246,500 won, while Hanwha Aerospace, a defense industry leader, dropped 2.83 percent to 927,000 won. The local currency was quoted at 1,369.4 won against the U.S. dollar at 3:30 p.m., marking a decrease of 6.7 won from the previous session.
Bond prices, which move inversely to yields, fell as yields on three-year Treasurys rose by 2.4 basis points to 2.472 percent, and the yield on benchmark five-year government bonds increased by 2.5 basis points to 2.637 percent.