Kospi rebounds to end at fresh peak on tech rally, but won drops
A man walks by a display showing the Kospi and Kosdaq figures inside the trading room of Hana Bank in Jung District, central Seoul, at the end of trading on May 13. [YONHAP]
Korean stocks rebounded by more than 2 percent to settle above the 7,800 point mark on Wednesday, as investors scooped up semiconductor and auto shares amid lingering Middle East tensions ahead of the U.S.-China summit.
The benchmark Kospi closed at 7,844.01, up 200.86 points, or 2.63 percent, from the previous trading session, reversing course after opening 1.69 percent lower.
The index fell 2.29 percent and finished at 7,643.15 on Tuesday on profit hunting, ending a five-session bullish run driven by tech stocks.
On Wednesday,
trade volume was heavy with 733.4 million shares worth 49.7 trillion won ($33.4 billion), with losers outnumbering winners 599 to 281.
Individual investors and institutions led the uptick, purchasing a net 1.9 trillion won and 1.7 trillion won worth of stocks, respectively, while foreigners unloaded a net 3.7 trillion won.
Overnight, U.S. inflation in April rose at the fastest pace in nearly three years, and oil prices climbed back above $100 per barrel amid fading hopes for a Middle East peace deal.
Investor sentiment, however, improved on expectations that the upcoming U.S.-China summit could help ease concerns over the Iran war.
Market sentiment also improved, as the prime minister and finance minister called on Samsung Electronics’ management and labor to sit again at the negotiation table to resolve their differences over a pay raise and bonus payments.
The two sides failed to reach an agreement during overnight mediation talks.
“Eased risks at home and abroad helped the Kospi turn around,” Lee Kyung-min, an analyst at Daishin Securities, said. “AI-related stocks, such as Samsung Electronics, SK hynix and SK Square, led the uptick.”
President Lee Jae Myung wrote on his social media that his chief policy adviser’s recent viral post about redistributing profits from the AI boom was about reviewing the distribution of surplus tax revenue, not a new levy on corporate profits.
Presidential policy chief Kim Yong-beom’s remarks regarding profit-sharing of tech companies in the AI era weighed down investor sentiment on Tuesday.
Semiconductor and auto shares were the biggest winners on Wednesday.
Samsung Electronics rose 1.79 percent to 284,000 won, and SK hynix jumped 7.68 percent to 1.98 million won.
AI investment firm SK Square rose to 5.68 won to 1.19 million won, and Samsung Electro-Mechanics, an electronics parts and module affiliate of Samsung Electronics, vaulted 7.41 percent to 1.03 million won.
Top carmaker Hyundai Motor surged 9.91 percent to 710,000 won, and its sister Kia advanced 6.65 percent to 197,500 won.
Major retailer Shinsegae soared 9.29 percent to 482,500 won, and Lotte Shopping added 5.54 percent to 160,100 won.
However, defense giant LIG D&A declined 0.68 percent to 873,000 won, and leading banking group KB Financial Group lost 1.04 percent to 152,000 won.
Leading biotech company Samsung Biologics decreased 2.29 percent to 1.41 million won, and Celltrion dropped 1.45 percent to 190,500 won.
The won was quoted at 1,490.6 won against the dollar at 3:30 p.m. The local currency briefly touched the 1,499.9 won level during the day.
Yonhap
