Seoul: South Korean stocks shot up nearly 6.5 percent Wednesday, extending a record-breaking run to top the 7,300-point mark, driven by a semiconductor rally and optimism for a potential peace deal in the Middle East. The local currency also strengthened against the U.S. dollar.
According to Yonhap News Agency, the benchmark Korea Composite Stock Price Index (KOSPI) added 447.57 points, or 6.45 percent, reaching a fresh record high of 7,384.56. This marked the second-largest daily gain in terms of points, following the 490.36 points recorded on March 5. Trade volume was notably heavy, with 984.4 million shares worth 58.2 trillion won (US$40 billion) changing hands, as losers outnumbered winners 199 to 677.
The surge in stock prices was bolstered by foreign investors purchasing 3.1 trillion won worth of local shares, while institutions and individuals offloaded a net 2.3 trillion won and 571.2 billion won, respectively. The KOSPI opened 2.25 percent higher, surpassing the landmark 7,000-point threshold for the first time, and continued to build on these gains throughout the session.
Additionally, the index has been on a bullish trajectory in recent months, having surpassed the 5,000-point mark in late January and the 6,000-point milestone in February. It regained its footing in March after the initial fallout from the U.S.-Iran conflict in late February, buoyed by the AI boom and the reopening of crucial trade routes.
Market analysts, including Lee Kyung-min from Daishin Securities, noted that strong performances by global tech giants and the robust AI data center value chain significantly boosted AI-related shares. Leading the rally were Samsung Electronics, SK hynix, and SK Square, with Samsung Electronics' market capitalization exceeding 1.5 quadrillion won, becoming the second Asian company to surpass the $1 trillion mark after Taiwan Semiconductor Manufacturing Co.
Despite the overall market upswing, some sectors faced declines. Shipbuilding and defense shares, including HD Hyundai Heavy Industries and Hanwha Aerospace, experienced downturns, while leading biotech firm Samsung Biologics and mobile carrier SK Telecom also saw their stock prices dip.
In the currency market, the Korean won appreciated against the U.S. dollar, quoted at 1,455.1 won per dollar at 3:30 p.m., marking the highest level since February 27. Meanwhile, bond prices closed higher, with the yield on three-year Treasurys falling 2 basis points to 3.595 percent, and the return on five-year government bonds dropping 1.1 basis points to 3.786 percent.