Seoul: South Korean stocks closed significantly higher on Tuesday, ending a three-day losing streak, propelled by gains in major chipmakers and automakers. This upturn came as the United States confirmed a reduction in tariff rates on imports from Seoul to 15 percent retroactively. The Korean won also appreciated against the U.S. dollar.
According to Yonhap News Agency, the benchmark Korea Composite Stock Price Index (KOSPI) rose by 74.56 points, or 1.9 percent, to finish at 3,994.93. Trade volume was moderate, with 315.13 million shares changing hands, valued at 12.23 trillion won (US$8.32 billion). Despite the overall market uplift, losers outnumbered gainers 641 to 223.
Foreign and institutional investors were net purchasers, acquiring stocks worth 121.47 billion won and 39.28 billion won, respectively. However, individual investors offloaded shares totaling 157.63 billion won. The index had started the day strongly, even as U.S. markets experienced losses.
The positive momentum continued after U.S. Commerce Secretary Howard Lutnick announced the reduction of Washington's 25 percent tariffs on South Korean autos to 15 percent, effective November 1st, as part of a trade and investment agreement finalized on October 29th during a summit between President Lee Jae Myung and U.S. President Donald Trump.
Lee Jae-won, an analyst at Shinhan Securities, noted, "Foreign investors have resumed net buying of semiconductor stocks," attributing some of the gains in Hyundai Motor and Kia to Lutnick's announcement.
In Seoul, most large-cap stocks saw an increase. Semiconductor giants led the rally, with Samsung Electronics rising 2.58 percent to 103,400 won, and SK hynix climbing 3.72 percent to 558,000 won. LG Energy Solution, a leading battery manufacturer, saw a modest increase of 0.48 percent to 415,000 won.
Automakers also experienced a surge, with Hyundai Motor jumping 4.52 percent to 266,000 won, and Kia increasing 4.19 percent to 117,000 won, alleviated by reduced tariff concerns.
The local currency was valued at 1,468.4 won per U.S. dollar at 3:30 p.m., up 1.5 won from the previous session. Bond prices, which typically move inversely to yields, also rose. The yield on three-year Treasurys fell 2.3 percent to 3.022 percent, while the return on benchmark five-year government bonds decreased 2.2 basis points to 3.211 percent.