Seoul: South Korean stocks surged more than 5 percent to close at a new high on Monday, nearing the 7,000-point threshold. This rise was fueled by investor interest in semiconductor shares as the market anticipated progress in U.S.-Iran peace negotiations. The Korean won also saw a significant uptick against the U.S. dollar.
According to Yonhap News Agency, the Korea Composite Stock Price Index (KOSPI) increased by 338.12 points, or 5.12 percent, reaching a record high of 6,936.99. The trading volume was substantial, with 864.3 million shares changing hands at a total value of 41.3 trillion won (approximately US$28.2 billion). Despite the overall market gain, there were more losing stocks than winners, with 473 losers compared to 392 winners.
Foreign investors purchased local shares worth 3 trillion won, and institutions bought a net 1.9 trillion won. Meanwhile, retail investors sold a net total of 4.8 trillion won. The index initially opened 2.79 percent higher following U.S. President Donald Trump's announcement regarding a plan to guide non-combatant vessels through the Strait of Hormuz, described as a "humanitarian gesture," set to start this week. However, a senior Iranian official cautioned that any U.S. interference in the strait would be perceived as a ceasefire violation.
The KOSPI continued to climb in the afternoon, buoyed by foreign and institutional buying. Lee Kyung-min, an analyst at Daishin Securities, noted that tech shares gained momentum following a positive performance on Wall Street over the weekend. Foreign investors increased their purchases ahead of the market closure for Children's Day on Tuesday.
The KOSPI had previously surpassed the 5,000-point mark in late January and reached the 6,000-point milestone in February. After recovering from losses in March due to the U.S.-Iran war outbreak in late February, the index is now approaching the unprecedented 7,000-point level, driven by optimism surrounding the AI boom and the potential reopening of the strategic waterway.
Semiconductor stocks were at the forefront of this rally. Samsung Electronics saw a 5.44 percent increase to 232,500 won, and SK hynix surged 12.52 percent to a record high of 1.4 million won, marking a milestone of over 10 trillion won in market capitalization. Additionally, Hanmi Semiconductor rose 2.72 percent to 378,000 won, while Samsung Electro-Mechanics surged 10.34 percent to 918,000 won.
Defense shares also performed well, with Hanwha Aerospace advancing 3.39 percent to 1.4 million won and LIG DandA rising 4.46 percent to 983,000 won. Hyundai Motor, the top carmaker, increased 1.51 percent to 539,000 won, and leading battery manufacturer LG Energy Solution climbed 2.5 percent to 472,000 won.
Conversely, bio shares experienced a downturn, with Celltrion dropping 1.35 percent to 197,800 won and Samsung Biologics falling 2.58 percent to 1.4 million won. The Korean won was quoted at 1,462.8 against the U.S. dollar at 3:30 p.m., an increase of 20.5 won from the previous session, marking the highest level since February 27 when it closed at 1,439.7 to the dollar.
Bond prices, which move inversely to yields, ended lower. The yield on three-year Treasurys increased by 2 basis points to 3.615 percent, while the yield on benchmark five-year government bonds rose 1.7 basis points to 3.797 percent.