Seoul:Seoul shares surged by more than 6 percent on Wednesday, driven by a rally in chipmakers following SK hynix's report of record quarterly earnings and the announcement of additional shareholder returns. Meanwhile, the Korean won weakened against the U.S. dollar.
According to Yonhap News Agency, the benchmark Korea Composite Stock Price Index (KOSPI) gained 374.1 points, or 6.63 percent, closing at 6,012.44, after reaching as high as 6,032.28. The Korea Exchange activated a buy-side sidecar shortly before 11 a.m., suspending program trading buy orders for KOSPI-listed stocks for five minutes. This measure is triggered when KOSPI 200 futures rise at least 5 percent and stay at that level for at least one minute and was activated for the second consecutive session.
Earlier in the day, SK hynix reported record-high revenue and operating profit for the third quarter, fueled by robust memory chip demand amid the artificial intelligence (AI) boom. The company, which is the world's second-largest memory chip maker, announced a shareholder return program worth more than 100 trillion won (US$75.3 billion) for 2026. Investors are also anticipating the Federal Reserve's interest rate decision scheduled for early Thursday (Korean time), seeking signals on the future path of U.S. interest rates.
In the dealing room of Hana Bank in central Seoul, financial data displayed that trade volume was light at 223.2 million shares worth 19.83 trillion won, with advancers outnumbering decliners 580 to 288. Foreigners and institutions bought a net 815.83 billion won and 960.79 billion won, respectively, while individuals sold a net 1.8 trillion won.
Lee Jae-won, an analyst at Yuanta Securities, noted that SK hynix demonstrated strong demand for AI chips can lead to solid operating profits and shareholder returns, easing concerns about the sustainability of the AI-driven rally and a potential peak in the memory chip cycle. Market heavyweights experienced widespread gains, with Samsung Electronics jumping 9.01 percent to 242,000 won, and SK hynix soaring 10.89 percent to 1.49 million won. SK Square, the parent firm of SK hynix, advanced 11.23 percent to 921,000 won, and Samsung Electro-Mechanics surged 8.74 percent to 1.3 million won.
The Korean won was trading at 1,337.7 won against the U.S. dollar at 330 p.m., down 10.7 won from the previous session's close. Bond prices, which move inversely to yields, closed lower, with the yield on three-year Treasurys gaining 4.1 basis points to 3.799, and the return on the benchmark five-year government bonds adding 5 basis points to 3.949.