Seoul: South Korean stocks closed slightly higher on Friday, marking a fourth consecutive session of gains and reaching a new record high. This surge was driven by investor interest in artificial intelligence (AI) shares, despite ongoing concerns about a bubble in the sector. However, the local currency weakened against the U.S. dollar.
According to Yonhap News Agency, the benchmark Korea Composite Stock Price Index (KOSPI) gained 3.11 points, or 0.06 percent, to close at 5,224.3. It had peaked at 5,321.68 earlier in the session. The trading volume was substantial, with 852 million shares changing hands, valued at 34.7 trillion won (approximately US$24.1 billion). The market saw more losers than gainers, with 602 stocks down compared to 278 up.
Investor activity showed individuals purchasing a net 2.2 trillion won, while foreign investors sold a net 1.9 trillion won. Institutional investors also offloaded shares worth a net 425 billion won. Despite worries about a bubble, investors continued to buy tech shares due to their demonstrated robust earnings amid the ongoing AI cycle.
Han Ji-young, a researcher at Kiwoom Securities, commented on the situation, stating that AI hardware and software companies need to address concerns about their profitability in the near term. Han also noted that the market's preference for chipmakers supplying memory products to these companies would remain strong.
The market's upward momentum was somewhat restrained by U.S. President Donald Trump's announcement of plans to reinstate "reciprocal" tariffs and auto duties on South Korea to 25 percent this week. This development added a layer of uncertainty to the market.
In the stock market, top-cap Samsung Electronics saw a slight decline of 0.12 percent to 160,500 won, while SK hynix achieved a fresh high, rising 5.57 percent to 909,000 won. The brokerage sector benefited from the market rally, with Mirae Asset Securities climbing 4.65 percent to 42,750 won and Kiwoom Securities increasing 4.11 percent to 443,500 won.
Telecom companies also experienced gains, with top mobile carrier SK Telecom rising 4.32 percent to 72,500 won due to an improved business outlook, and its competitor KT adding 1.43 percent to 56,900 won. Samsung SDI saw a modest increase of 0.52 percent after announcing a new battery supply contract, believed to be linked to Tesla Inc.'s energy storage system business.
The Korean won was quoted at 1,439.5 against the U.S. dollar at 3:30 p.m., representing a decline of 13.2 won from the previous session's close.