Key Takeaways:
South Korea’s benchmark stock index pushed further into record territory, closing above the 6,400 level for the first time as a surge in retail buying overpowered concerns about Middle East tensions and a sell-off by foreign investors.
"As geopolitical uncertainties ease, the impact of performance and orders is expanding," Lee Kyung-min, a researcher at Daishin Securities, said. "Foreign and institutional funds are flowing in due to sector-specific positive factors, leading to a strong performance centered on large-cap stocks."
The KOSPI gained 0.46 percent to close at 6,417.93 on Wednesday, its second straight record high, according to Korea Exchange data. The rally was driven by individual investors, who bought a net 1.24 trillion Korean won ($840 million) worth of shares. This offset net selling from foreign investors and institutions, who offloaded 675 billion won and 448.5 billion won, respectively.
The advance came despite initial weakness after peace talks between the U.S. and Iran collapsed, which pushed the local currency lower. The Korean won weakened against the U.S. dollar, with the exchange rate closing at 1,476 won, up 7.5 won. While market bellwethers Samsung Electronics Co. and SK Hynix Inc. fell 0.68 percent and 0.08 percent, respectively, other firms saw significant gains. HD Hyundai Heavy Industries Co. surged 11.28 percent after signing a major supply contract with a U.S. energy company.
The broader market is showing signs of strength, with 39 individual stocks on the Kospi hitting new one-year highs this month, according to the Korea Exchange. The IT Hardware and Construction & Architecture sectors have been leading performers, each posting year-to-date returns of 97.4 percent. The KOSDAQ index also rose 0.18 percent, marking its ninth consecutive day of gains.
This article is for informational purposes only and does not constitute investment advice.
