Kospi Edges Higher, Snaps Two-Day Losing Streak As Bargain Hunters Rescue Chip Stocks After Wall Street Rally

SEOUL — South Korea’s benchmark Kospi index closed higher Monday, snapping a two-session losing streak, as bargain hunters moved into semiconductor-related shares following a record-setting rally on Wall Street, even as foreign investors continued heavy selling and the won weakened against the dollar.

The Kospi rose 40.89 points, or 0.65%, to close at 6,299.66 after a volatile session that saw the index swing between strong early gains and a more subdued afternoon. The index opened 0.76% higher at 6,306.33 and briefly surged as much as 2.16% in early trading before paring most of those gains as the day wore on, ultimately settling just shy of the psychologically significant 6,300 level.

The secondary Kosdaq market fared considerably better, jumping 6.97% to close at 854.47, a gain of 55.66 points, as smaller technology and growth-oriented stocks attracted heavy buying interest.

Trading volume on the main board was moderate, with 629.9 million shares changing hands worth a combined 29.09 trillion won, or roughly $20.5 billion. Advancing stocks outnumbered decliners by a wide margin of 695 to 183, suggesting broad-based buying even as the index’s overall gain remained modest relative to the number of stocks that moved higher.

Foreign investors extended their selling streak, offloading a net 1.48 trillion won worth of shares during the session. Institutional investors and retail traders both stepped in on the other side of those trades, purchasing a net 567.4 billion won and 899.8 billion won, respectively, helping cushion the market against the scale of foreign outflows.

Large-cap technology names were mixed. Samsung Electronics slipped 0.43% to 230,000 won after opening in positive territory, while SK Hynix edged down 0.14% to 1.42 million won, also having started the session higher before losing ground. The pullback in the two chip giants came after reports that Apple is considering sourcing memory chips from Chinese manufacturer CXMT, a development that weighed on sentiment toward Korea’s dominant semiconductor exporters even as the broader market advanced.

Lee Kyung-min, an analyst at Daishin Securities, said the reports around Apple’s potential shift toward Chinese memory suppliers pressured large-cap chip stocks during the session, even as “bargain hunters moved into semiconductor equipment and materials stocks” elsewhere in the sector, helping offset losses in the biggest names.

Other major stocks fared better. LG Energy Solution gained 2.08% to 367,500 won, while automaker Hyundai Motor rose 3.16% to 408,000 won, both benefiting from renewed investor appetite following the strong close on U.S. markets at the end of last week.

Monday’s rebound in Seoul followed a rally on Wall Street on Friday, when U.S. job data eased concerns over further interest rate hikes from the Federal Reserve. The Dow Jones Industrial Average rose 0.28% and the S&P 500 added 0.62% to close at a fresh record, while the tech-heavy Nasdaq Composite jumped 1.3%. The improved sentiment on U.S. markets carried into Asian trading Monday, with Japan’s Nikkei 225 also posting solid early gains alongside the Kospi as investors across the region responded to easing rate-hike fears and renewed optimism around artificial intelligence-related spending.

The Korean won weakened by 2.3 won from the previous session to trade at 1,418.4 won against the dollar as of 3:30 p.m. local time, reflecting continued pressure on the currency even as local equities advanced. The won’s slide came against a backdrop of persistent foreign selling in Korean equities, a dynamic that has kept currency traders watchful in recent weeks even as the stock market itself has shown resilience.

Monday’s gains came after the Kospi closed lower for two consecutive sessions last week, weighed down by a bout of foreign selling that had interrupted what had otherwise been a strong year for Korean equities. The index remains sharply higher than year-ago levels, having been lifted over the past year by sustained investor enthusiasm for semiconductor stocks and optimism around artificial intelligence-related capital spending across the technology sector, even as the market has periodically seen sharp pullbacks tied to swings in global risk appetite and volatility linked to leveraged retail trading products.

The session also unfolded against a broader domestic political backdrop, with South Korean President Lee Jae Myung facing declining approval ratings amid concerns over policy execution and debate around the administration’s approach to prosecutorial investigative powers. While the political developments have drawn attention domestically, Monday’s market action appeared to be driven primarily by the shift in global sentiment following Friday’s Wall Street rally rather than by local political news.

Looking ahead, investors in Seoul are likely to continue watching developments in the global semiconductor supply chain closely, particularly any further signals on whether major U.S. technology companies might diversify their chip sourcing away from established Korean suppliers. Market participants are also expected to keep a close eye on upcoming U.S. inflation data and any further signals from the Federal Reserve on the path of interest rates, both of which are likely to continue shaping sentiment in Seoul in the sessions ahead.

For now, Monday’s advance offered some relief to investors after a choppy stretch for Korean equities, even as the modest size of the Kospi’s gain — relative to both its early intraday surge and the much larger rally in the Kosdaq — suggested that sentiment toward the market’s largest constituents remained cautious.